Total rejects campaigners’ pressure to freeze payments to Myanmar junta

Total has rejected campaigners’ calls to withhold payments to Myanmar’s military junta from its offshore gas project in the country, saying that doing so would break the law and put local employees in danger. 

The energy giant also said it had no plans to stop production at the Yadana offshore gasfield, which it said was used to generate electricity for millions of people in Yangon, Myanmar’s largest city, and in western Thailand.

The comments, made by Total chair and chief executive Patrick Pouyanné in a letter released at the weekend, put the French energy group at odds with Myanmar’s civil disobedience movement, which has sought to choke off the junta’s revenue sources since the February 1 coup that ousted Aung San Suu Kyi’s government.

“The first thing to remember is that not paying taxes is a crime under local law,” Pouyanné said, adding that Total had in actuality paid “absolutely no taxes” to the military since the coup “for the simple reason that the banking system no longer functions”.

He added that the company had considered putting $4m of monthly taxes into an escrow account, “but such non-payment would expose our affiliate’s management to arrest and imprisonment”. Pouyanné said that Total would also consider donating the equivalent of the taxes it owed the state to groups working for human rights in Myanmar. 

Total is the operator and largest shareholder of the Yadana gasfield off the coast of southern Myanmar. It runs the field and its pipelines with Chevron, Thailand’s PTT, and the state-owned Myanmar Oil and Gas Enterprise as its partners.

Human rights groups and a shadow government representing ousted National League for Democracy MPs have urged foreign energy companies to freeze all payments to MOGE since the coup. But the multinationals have pointed out that most of what they paid the state was in the form of natural gas used to generate power.

Justice for Myanmar, a campaign group leading calls for companies to sever ties with the military, rejected Pouyanné’s explanation. 

“Total will be complicit in the Myanmar junta’s crimes against humanity if they commence payments to the military,” said spokesperson Yadanar Maung, describing the offer of donations to rights groups as “a gruesome and nonsensical equation that plays with our people’s lives”.

The UN has condemned the military’s use of violence against anti-coup protesters, and the US and UK have imposed sanctions against junta leader General Min Aung Hlaing, other senior officials and military-linked businesses. The military’s violent crackdown has resulted in at least 557 deaths and more than 2,600 arrests, according to a leading human rights group.

Pouyanné said Total had given instructions to cease drilling operations, decommission a rig and halt development of a gas discovery on an offshore block. 

However, he said the French energy group would suspend gas operations at Yadana only if it was no longer possible to produce it safely because of “the dramatic events unfolding onshore”.

Pouyanné said that Thai authorities had also alerted Total to the “importance” of the gasfield to western Thailand. “Can a company like Total decide to cut the supply of electricity to millions of people — causing the closure of hospitals and businesses, upending everyday life — with all the consequences that it will have?” 

He also warned that withdrawing from Myanmar could expose Total’s local employees to forced labour.

“Having seen the practices of the junta in other economic sectors, and given the vital importance of this gas for the generation of power, we have no doubt that the junta will not hesitate to force our employees to produce the gas by forced labour,” he said. 

Total’s remarks echoed those made by Chevron, which has also come under pressure from campaigners. Chevron last month said its direct payments were limited to taxes and that it played no part in the onward distribution of gas MOGE received.

Malaysia’s Petronas last week declared force majeure on its Yetagun offshore gasfield, citing declining production for its decision.

Follow John Reed on Twitter: @JohnReedwrites