Is China Playing Safe with its Burma Pipeline Plan?

By WILLIAM BOOT
The Irrawaddy News

BANGKOK—China appears to be making alternative plans in case its Middle East oil transshipment port and pipeline project in Burma fails because of regime change.

The Chinese state-owned oil and gas conglomerate China National Petroleum Corporation (CNPC) is spending at least US $1.5 billion to use Burma as a conduit for oil shipments from the Middle East and Africa. But as a backup in case this scheme has to be abandoned it is now also investing in a multibillion dollar oil project in northern Malaysia.

The CNPC is to play a central role in a regional oil processing and transshipment hub link between the Middle East and China on the northwest coast of Malaysia facing the Indian Ocean just like the port development at Kyaukpyu on Ramree Island on the central Burma coast.

Crude oil from Saudi Arabia and probably also Iran will be shipped to a $10 billion refinery on reclaimed land at Yan in Malaysia’s Kedah state close to the border with southern Thailand.

The refinery will have a capacity of 350,000 barrels a day and CNPC will take at least 200,000 bpd.

The chief Malaysian developer, Merapoh Resources Corporation, says the Chinese are likely to become major shareholders. Industry reports suggest that one of the chief financiers of the Yan project, Hong Kong-based equity procurers Beijing Star, is in fact acting as a proxy for CNPC.

This new plan involving Chinese investment revives a Malaysian idea that rose briefly two years ago and then sank without trace, Bangkok-based oil industry consultant-analyst Sar Watana told The Irrawaddy.

In 2007, Malaysia was looking for financial backing for a west coast transshipment port and cross-country pipeline. The main beneficiary would have been China, but the Chinese seemed to lose interest as the Burma pipeline possibility grew.

The re-emergence of this project with China closely involved implies that the Chinese are not going to rely solely on the Burma transshipment scheme.

Both projects short-cut the long sea journey tankers heading for China’s south and east coasts from north Africa and the Middle East currently have to make via the Malacca Strait and Singapore at the bottom of the Malaysian peninsula. More than 60 percent of China’s oil imports pass through the strait.

China has not disclosed how much crude oil it plans to transship through Burma, but the deep-draught port on Ramree Island will be able to handle the biggest bulk tankers. Oil will be pumped 1,200 kilometers in unprocessed form to a refinery in Kunming, capital of neighboring Yunnan province.

There has been speculation that further pipelines inside China will move some of the oil deeper into China to other provinces.

Work on the Burma oil pipeline is supposed to begin before the end of this year, according to Chinese media reports, and be operational by 2012.

The Malaysian refinery at Yan is scheduled to be completed in 2014.

Another Chinese state company, China National Overseas Oil Corporation, had reportedly been involved in Malaysia’s 2007 oil transshipment plans.

According to Malaysia’s Merapoh Resources Corporation, 40 percent of the Yan project will be owned by Beijing Star of Hong Kong.

Beijing Star chairman Li Feng Yi was quoted by The Star newspaper in Malaysia as saying his firm will sell its share in the finished Yan refinery to CNPC.

From a commercial point of view it doesn’t seem to make sense for China to be involved in two major oil trans shipment schemes in fairly close proximity of Southeast Asia, says Collin Reynolds, another industry analyst in Bangkok.

But these Chinese state oil-gas giants have very, very deep pockets, and their primary purpose is supply, not cost, Reynolds told The Irrawaddy.

It begins to look as though China is hedging its bets. Burma is very much a client state right now, with Beijing able to manipulate the military junta for its own ends.

READ MORE---> Is China Playing Safe with its Burma Pipeline Plan?...

Rights violations along 180-mile gas pipeline shocking, ongoing, says new report

Mon Son and Blai Mon - IMNA

“Pervasive human rights abuses” are occurring along an extensive overland pipeline in southern Burma, says a report released by a rights group yesterday. Rape, summary execution, forced labor and other abuses are the deliberate, predictable result of the pipeline, says the group, as is the confiscation of almost 15,000 acres of land.

The report, released by the Human Rights Foundation of Monland (HURFOM), deals with the government-owned Kanbauk to Myaing Kalay pipeline, which branches off the Yadana gas project in Tenasserim Division. The Yadana project has received intense international criticism for its role in rights abuses; the consortium of international energy companies who control it have been sued in 3 countries, with one investor pulling out.

According to HURFOM, abuses along the Kanbauk to Myaing Kalay pipeline are comparable in type, though not in scale, to those documented in relation to the Yadana project; at 183-miles, the Kanbauk to Myaing Kalay pipeline is more than four times longer than the 40-mile Yadana project.

HURFOM organizes abuses documented in the report into two broad categories. In the first, the group argues that a threefold increase in Burmese army deployments to the area since is “fundamentally due” to the pipeline.

“The predictable result of deploying large numbers of soldiers and encouraging them to extract what they can from the countryside, without oversight,” says the group, is a “raft of abuses.” According to the group, these include: 12,000 acres of land confiscation for barracks and army agriculture projects, forced labor, 62 incidents of rape and the commandeering of food and property.

In the second category, abuses along the pipeline are also a “deliberate, calculated part of the pipeline security effort” in which “battalions seeking to protect the pipeline from insurgents do so largely by targeting civilians.” According to HURFOM, this has entailed travel restrictions, forced relocation, and 68 incidents of torture and summary execution involving more than 600 victims.

Also related to pipeline security, HURFOM says it has confirmed that residents of more than 40 villages – including children as young as 12 – are required to work as forced laborers maintaining and guarding the pipeline. More than 2,400 acres of land, meanwhile, have been confiscated to ensure the pipeline’s route can be easily patrolled.

Making clear just how “ongoing” the abuses really are, a press release distributed to mark the report’s publication notes that, in just the last week, HURFOM has documented the summary execution of one villager and the burning of 36 homes. “In both cases,” says the release, “the army committed the abuses less than a mile from the pipeline.”

On the other side of Burma, meanwhile, construction of another pipeline is just beginning: in late March, Burma and China agreed to transport gas from the Shwe gas fields 1,200 miles overland to southwestern China.

Win Aung, coordinator of the Shwe Gas Movement, which opposes the project, says abuses like those documented by HURFOM have already begun. “The number of army battalions have already increased in the area,” Win Aung told IMNA today. “Human rights violations happened when the government started this project – and they are still happening.”

“They have not started building the pipeline yet. But they have to make the way clear for the pipeline – so villagers have to work as forced laborers clearing brush and digging.” These abuses are just the beginning, says Win Aung.

“According to what I see in the HURFOM report, these kinds of human rights violations – forced labor, torture, etc. – will happen in the Shwe Gas area. And the Shwe Gas pipeline is much longer than the pipeline to Kanbauk.”

READ MORE---> Rights violations along 180-mile gas pipeline shocking, ongoing, says new report...

Burma-Bangladesh Maritime Talks Fail

By WAI MOE
The Irrawaddy News
November 18, 2008

Burma and Bangladesh failed to resolve the simmering tension between the two countries over a disputed maritime boundary in the Bay of Bengal, according to Bangladeshi newspapers. Talks will resume in Burma in January.

The New Age newspaper said that the two countries ended the two-day maritime boundary delimitation talks inconclusively as both sides refused to change their positions on the method of marking the coastline of the exclusive economic zones in the Bay of Bengal.

“Myanmar[Burma] proposed a corridor in the Bay, and we have rejected it since we feel that equity should be the guiding method to settle the issue under the UN [United Nations] Convention on the 1982 Law of the Sea,” MAK Mahmood, Bangladesh’s additional foreign secretary, told reporters after the meeting on Monday.

He said the Burmese junta rejected the area claimed by Bangladesh. “So, Bangladesh’s plea is not acceptable to them,” he said.

Burma’s deputy foreign minister Maung Myint led the delegation to Bangladesh.

Dhaka’s The Daily Star reported that the next round meeting between the two countries will be held in Burma in January only four months ahead of the Burmese military regime’s deadline for maritime demarcation claims to the UN.

Burma will have to claim the maritime demarcation with Bangladesh by May 21 and the Bangladesh deadline is July 27, 2011 under the UN Convention on the Law of the Sea (UNCLOS-1982).

Burma and Bangladesh talks over the disputed area started in 1974, but the talks were put on hold for more than two decades and only resumed in January. The Dhaka meeting was the fourth round of talks following recent tension in the Bay of Bengal involving maritime vessels from both countries.

In October, the Burmese authorities sent navy ships into the area and permitted a South Korean company to explore for nature gas in the disputed area, prompting Bangladesh to position naval ships in the area.

Vice Snr-Gen Maung Aye, the No. 2 high ranking general at the Burmese junta, visited Bangladesh in early October to attempt to resolve the tension, but the talks failed.

Burmese ruling generals reportedly discussed the dispute at a junta meeting in Naypyidaw which ended last week.

Khine Myat Kyaw, a Burmese journalist who is based in Dhaka, said the two countries are still deploying army troops near the border.

Meanwhile, Burma and China agreed to construct a US $2.5 billion oil-and-gas pipeline project China, according to Japan’s The Nikkei newspaper.

Burma’s state-own Myanmar Oil and Gas Enterprise will own a 49.1 percent stake while the China National Petrol Corp will have 50.9 percent. A US $1.5 billion oil pipeline, and US $1.04 billion gas line will be built, as well as oil and gas storage tanks near Burma’s Kyaukpyu Port, The Nikkei said.

The Burmese regime earned an estimated US $2.5 billion by selling nature gas to Thailand last year.

READ MORE---> Burma-Bangladesh Maritime Talks Fail...