Monday, October 10, 2011

NGO urges halt to Shwe natural gas project

New Delhi (Mizzima) – The Thailand-based Shwe Gas Movement has called for the Burmese government to suspend another huge energy project, the Shwe natural gas project in Arakan State.

Work is underway on the Shwe energy pipeline in Burma that will transport oil and natural gas to Kunming, China. Photo: Shwe.org
Work is underway on the Shwe energy pipeline in Burma that will transport oil and natural gas to Kunming, China. Photo: Shwe.org
“Exporting the huge natural gas reserves from the Shwe Gas fields off Burma’s western coast will perpetuate the chronic energy shortages domestically,” it said in a statement released on Friday.

“The regime will earn an estimated US$ 29 billion from the sale of the gas, yet these revenues will not be used for social improvement. The revenues will disappear into a fiscal black hole that omits gas revenues from the national budget, clearly to the benefit of the regime and investors,” said the statement.

After widespread protests, President Thein Sein ordered a suspension of the US$3.6 billion Myitsone Dam project on the Irrawaddy River. The Shwe Gas Movement wants a similar order regarding the Shwe energy project, which was started in October 2009. The project includes a special economic zone that will be the largest in Southeast Asia, and includes the construction of a Kyaukphyu-Muse electric railway at a cost of US$ 20 billion.

An underwater gas pipeline would carry offshore gas from block A1 and A3 to Kyaukphyu. About 40 per cent of the project is completed and the deep-sea port at Maday Island is about 80 per cent completed, according to the Shwe Gas Movement.

Gas reserves in the two blocks are estimated at 4.5 to 7.7 trillion cubic feet. Burma will earn an estimated US$ 29 billion from the sale of the natural gas to China over a 30-year period starting in 2013.

The deep-sea port project and the joint pipeline for oil and natural gas will be completed in 2013. The electric railway for transporting goods is expected to be completed in 2015.

The huge project is part of a new sea route for oil tankers to and from the Maday Island deep-sea port. The Daewoo Company has dynamited a three-mile coral reef located near Zinchaung Village in May, the Bangladesh-based Narinjara news agency reported. The Maday Island deep-sea port is located six miles southeast of Kyaukphyu in Arakan State.

Win Aung, an official of the Thai-based Shwe Gas Movement, said, “Possible environmental impacts and people-based surveys need to be conducted. They should have transparency to the effect on people, how much the environment will be affected and how much residents will benefit from the project.”

The offshore blocks in the Shwe Gas field, the biggest natural gas field in Southeast Asia, has an estimated 200 billion cubic meters of natural gas. The gas blocks in the Shwe field in the western sea of Burma was discovered in late 2003. The cost of the gas pipeline linking the Kyaukphyu and Maday Island deep-sea port to Yunnan Province in China is estimated at US$ 3.5 billion.

In addition to the natural gas pipeline, an oil pipeline will be built to transport oil from Africa and the Middle East to China through the Kyaukphyu-Maday port passing along a route running through Minbu, Mandalay, Gokteik, Kyaukme, Hsipaw, Lashio, Kutkai, Muse and Kyuhkok. The oil will then be transported to Kunming, the capital of Yunnan Province.

Since March 2011, the Burmese Army has launched military offensives against ethnic armed groups in resource-rich areas in northern Kachin and Shan states. The conflicts have displaced an estimated 50,000 people, the Shwe Gas Movement’s statement said.

Foreign companies involved in the projects include the China National Petroleum Corporation, Daewoo International (South Korea), ONGC Videsh Company Limited (India), and Gas Authority of India Limited (GAIL).

A report, “Sold Out”, released on September 6 by the Shwe Gas Movement, said that regarding construction of the deep seaport and oil storage facilities on Maday Island, the China National Petroleum Corporation has sub-contracted construction to a Burmese company, Hydro China, to supply material (sand, stones, etc.), and Asia World, which is building a reservoir system. Regarding an onshore gas terminal complex on Ramree Island, Daewoo International issued sub-contracts to Burmese companies including Myanmar Golden Crown.

Rakhine Nationalities and Development [RNDP] Party chairman Aung Mya Kyaw said, “This is connected to the interests of all citizens. We strongly object on the grounds that our people will not enjoy any benefits from the project.”

The report said that residents living around the projects in Arakan State have been used as forced labour by the Burmese army and police. In some cases, land has been confiscated by authorities that offered insufficient compensation, the report said.
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