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TotalEnergies and Chevron Walk Away From Myanmar's Yadana Gas Field

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File image courtesy Total

Published Jan 24, 2022 2:40 PM by The Maritime Executive

Myanmar's military junta is losing Western participation in the Yadana field, the offshore development that supplies half of the country's gas (and half the fuel for power generation). The project provides a steady stream of export revenue for the state-owned Myanma Oil and Gas Enterprise (MOGE), and it is a key source of income for the regime. 

 After years of pressure from human rights groups, TotalEnergies - which owns a 31 percent operating stake in Yadana - has announced that it is abandoning its share and leaving the country within six months. Minority non-operating owner Chevron also plans to step away after arranging for an "orderly transition."

Gas production is expected to continue under a "new operator" after a transition period, potentially including participation from Thai oil and gas company PTT, an existing stakeholder in the field. 

Yadana has been controversial ever since Total partnered with MOGE to develop it in the early 1990s. At the time, Myanmar's military dictatorship had just seized power in a coup, and it was notorious for human rights abuses. In February 2021, the military dissolved the country's fledgling democratic government and returned to power once more, and it is more notorious than ever. The NGO Assistance Association for Political Prisoners estimates that the regime has killed about 1,500 civilians and political opponents since seizing power last year. 

"While our company considers that its presence in a country allows it to promote its values, including outside its direct sphere of operations, the situation, in terms of human rights and more generally the rule of law, which have kept worsening in Myanmar since the coup of February 2021, has led us to reassess the situation," TotalEnergies wrote. "As a result, TotalEnergies has decided to initiate the contractual process of withdrawing . . . without any financial compensation."

Until recently, Chevron had strongly opposed U.S. sanctions measures that would have shut down its participation at Yadana. "Any actions should be carefully considered to ensure the people of Myanmar are not further disadvantaged," Chevron argued last year. "[We] consider that any action we take in breach of agreements [with Myanmar] may open the door for another company that doesn’t share our values to take our place."

TotalEnergies also holds an exploration contract for offshore Block YWB and a 40 percent stake in Block A6, which received a successful appraisal in 2018. After the February 2021 coup, TotalEnergies suspended its work on developing A6.