Pressure mounts on Australian mining companies in Myanmar

March 12, 2021
Protest in solidarity with the Burmese people in Sydney on March 7. Photo: Peter Boyle/Green Left

With the ongoing repression and killing of anti-coup protesters in Myanmar/Burma, pressure is mounting on Australian companies — particularly those in the extractive industries — to denounce the coup and end their support for the country’s military.

While Australia’s foreign minister announced a belated suspension of “military cooperation” with Myanmar on March 7, it is increasingly apparent that revenue is flowing freely to the military through other channels.

Woodside forced to change tack

Woodside, Australia’s largest oil and gas company with a license to drill for natural gas in the Rakhine Basin, has felt the pressure of community protests and changed tack.

Following the February 1 coup, Woodside initially said their “drilling campaign remains on schedule”. Chief Executive Officer Peter Coleman told Energy News Bulletin, “It’s not up to us to judge the veracity of grievances [the military] have around the previous election process.”

In response to the vehement backlash to these comments, Coleman released a media statement on February 19, which said: “I regret that I made some remarks in a media interview that have been interpreted as condoning what has occurred in Myanmar.”

Woodside’s chairperson, Richard Goyder, received a letter from the Australian Council of Trade Unions, Australian Council for International Development, Amnesty International, Union Aid Abroad and Publish What You Pay on February 26. Among other questions, the letter asked: “What example does Woodside want to set for corporate Australia in relation to doing business with governments that are accused of genocide and crimes against humanity by the United Nations?”

By the following day, Woodside announced it was “reducing [its] presence in the country and expects full de-mobilisation of [its] offshore exploration drilling team over the coming weeks”. It put “all business decisions under review” until “political stability has improved”.

While this is a positive step by Woodside, the Australasian Centre for Corporate Responsibility’s director Dan Gocher pointed out that Woodside’s “commitment” allows it to resume activities under the military regime, as soon as “political stability has improved”.

Gocher told the Sydney Morning Herald: “They should commit to not proceeding any further until democracy is restored — at the moment it’s a bit of fence-sitting.”

While Woodside is not currently producing any gas, when it does, by 2023, about 20% of its production will go to the state-owned Myanma Oil and Gas Enterprise (MOGE). In addition, its local taxes will go to government, now military, coffers.

Myanmar Metals ‘dubious links’ with cronies

Another Australian mining company, Myanmar Metals (MYL), with majority interest in the massive Bawdwin silver, lead and zinc mine in Shan State, has made no such changes to its plans.

It is also under pressure to condemn the coup and withdraw from the country, especially since a March 1 SMH article revealing its “dubious links” with Myanmar’s cronies, with intimate ties to the military. These same crony links were reported by Green Left on February 11.

Aware that these murky ties are a serious issue for MYL, a February 24 corporate update focused on its ties with “entities associated with Myanmar’s military” and concluded, “US sanctions do not target any entities or individuals with which MYL does or has done business.”

This update, however, fails to mention the background of two directors of its joint venture partner company, Win Myint Mo Industries: U Maung Kyay and U Than Myint.

U Maung Kyay was a co-founder of Asia World, along with Lo Hsing Han, known as the “godfather of heroin”. U Than Myint was a director of Asia World for two decades. A 2019 UN report puts Asia World at the top of the list of “the largest crony companies” in the country.

As the Perth-based company has all its investments in Myanmar, its shareholders are undoubtedly concerned about its future. Its share price fell from 10 cents on January 25 to 7 cents on February 1, the day of the coup. Since then, MYL’s shares have been in a trading halt at the request of the company.

Production sharing contracts with the military

Several other Australian mining companies are active in Myanmar. Perth-based, private company Tribis (formerly Transcontinental Group) was granted an exploration licence for Myanmar Offshore Block M-15 in 2015.

Tribis is searching for natural gas in the Moattama Basin, off the coast of the southern Tanintharyi Region. This licence is contingent upon a “production sharing contract” with state-owned MOGE.

In the same bidding round, Australian Stock Exchange-listed companies, Roc and Tap Oil, were granted licences for Myanmar Offshore Block M-7, in the same basin. Roc subsequently withdrew from this venture, leaving Tap Oil with a 95% share of the 13,000 square kilometre allocation.

In addition to taxes and other costs, Tap Oil will be obliged to give a significant share of the production to MOGE.

Brisbane-based PanAust Ltd is an Australian-incorporated copper and gold mining company. It is now a subsidiary of Chinese company Guangdong Rising Assets Management. PanAust holds a 90% interest in several blocks of land covering about 1500 km2 in Myanmar’s Sagaing Region.

All these companies currently contribute, or will contribute, to Myanmar’s military.

Stop providing revenue to the military

The Myanmar Alliance for Transparency and Accountability (MATA) is a national network of more than 450 civil society actors from all Myanmar’s states and regions. It advocates for transparency and accountability in the extractive industries.

MATA's statement on February 24 noted that, because “income from the oil and gas sectors is now one of the main sources of revenue for the military … [w]e therefore strongly call on all oil and gas companies to immediately stop providing revenue payments to the military.”

As Dr Thein Moe Win, from Action Against Myanmar Military Coup (Australia), told Green Left, in order push Australian companies in this direction, “the Australian government should also urge Australian businesses to stop cooperating with the Myanmar military”.

[Allen Jennings lived and worked in Myanmar for four years.]

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