TotalEnergies intends to commence the contractual process of pulling out from the Yadana field and from the associated pipeline firm Moattama Gas Transportation Company (MGTC) in Myanmar, as operator as well as shareholder, without seeking any financial compensation
TotalEnergies and Chevron have announced their withdrawal from Myanmar amid the prevailing political crisis in the country following a coup by the military in early 2021.
The two oil majors, which are partners in the offshore Yadana gas field in Myanmar, have cited violence and human rights abuses in the country as reasons for their exit.
TotalEnergies said that it will begin the contractual process of pulling out from the Yadana field and from the associated pipeline firm Moattama Gas Transportation Company (MGTC) in Myanmar, as operator as well as shareholder, without seeking any financial compensation.
The company’s withdrawal will come into effect at the latest at the expiry of the six-month contractual period.
Following the coup, TotalEnergies had decided to stop all its ongoing projects in the Southeast Asian country, but to continue drawing gas from the Yadana field.
The French company said that the Yadana gas is necessary for electricity generation for the local Burmese and Thai population as well as to shield its employees from being subjected to criminal prosecution or forced labour.
TotalEnergies stated that in spite of its actions, the company is not being able to meet several stakeholders’ expectations.
The company said that its shareholders, global and Burmese civil society organisations want it to stop the revenues going to Myanmar through the state-owned national oil company Myanma Oil and Gas Enterprise (MOGE) from the production of the gas field.
However, the French firm said that it is materially not possible as most of the payments for the gas are directly made by Thailand-based PTT, which is the buyer of the exported production.
Yadana field produces nearly six billion cubic meters of gas per annum. Of this, around 70% is exported to Thailand, and the remaining 30% is sold to MOGE for domestic use.
The French energy firm, in a statement, said: “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 and no longer allows TotalEnergies to make a sufficiently positive contribution in the country.”
Chevron, through its affiliate Unocal Myanmar Offshore (UMOCL), has a minority, non-operated stake in the Yadana gas field.
The US-based firm stated: “The situation is undoubtedly complex in Myanmar and we share the desire for lasting solutions. We will continue to engage constructively with governments, responsible business, and civil society to help deliver a brighter future for Myanmar.”