This photograph taken on May 28, 2021 shows the new TotalEnergies logo during its unveling ceremony, at La Defense on the outskirts of Paris.
CHRISTOPHE ARCHAMBAULT | AFP | Getty Images
French oil giant TotalEnergies and U.S. energy firm Chevron on Friday announced plans to withdraw from Myanmar, citing the deteriorating humanitarian crisis in the Southeast Asian country following last year’s coup.
TotalEnergies said it had started the process of withdrawing from the Yadana offshore gas field and the MGTC transportation system as the situation in the country “no longer allows TotalEnergies to make a sufficiently positive contribution in the country.”
The company said its partners had been notified and the withdrawal “will be effective at the latest at the expiry of the 6-month contractual period.”
‘Unprecedented’ crisis
Myanmar’s security forces are estimated to have killed nearly 1,500 people and arrested thousands as they continue to crack down on dissent since the coup in Feb. 2021. The country’s military junta has disputed these figures.
The U.N. has said the situation in Myanmar has been getting worse since the turn of the year, warning that people in the country are facing an “unprecedented” political, socioeconomic and humanitarian crisis.
It is estimated that 14 out of 15 states and regions in the country are within the critical threshold for acute malnutrition. The U.N. has said that in addition to the military coup, people’s needs are set to “escalate dramatically” amid a severe third wave of Covid-19 cases.
TotalEnergies said in a statement: “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.”
It added that it had, “decided to initiate the contractual process of withdrawing from the Yadana field and from MGTC in Myanmar, both as operator and as shareholder, without any financial compensation for TotalEnergies.”
Activist group calls for targeted sanctions
TotalEnergies has been a partner and operator of the Yadana gas field for almost three decades and was the biggest shareholder in the project with a 31.24% stake. Chevron, meanwhile, holds a 28.26% stake. PTTEP, a subsidiary of the Thai national energy company PTT, and Myanmar’s state-owned company MOGE hold the remainder.
The shareholders of the MGTC project are the same as the Yadana gas field and in the same proportions.
“In light of circumstances in Myanmar, we have reviewed our interest in the Yadana natural gas project to enable a planned and orderly transition that will lead to an exit from the country,” a spokesperson for Chevron told CNBC.
“As a non-operator with a minority interest in the project, our immediate priority remains the safety and well-being of employees, safe operations and the supply of much-needed energy for the people of Myanmar and Thailand,” they added.
Activist group Justice for Myanmar welcomed TotalEnergies’ decision to withdraw, calling for other energy companies to follow suit and for governments to impose targeted sanctions on Myanmar’s oil and gas sector.
“TotalEnergies has finally taken heed of the calls of Myanmar people, local and international civil society to stop the flow of funds to the terrorist junta,” Yadanar Maung, spokesperson for Justice for Myanmar, said in a statement.
“It is now essential that governments move ahead with targeted sanctions on oil and gas to deny the junta funds from the remaining oil and gas projects.”
Shares of TotalEnergies dipped 1.5% on Friday.
Source: CNBC