(First published in Norwegian 1 Jun 2006)
By Pia Gaarder
The rig “Frontier Duchess” is believed to have carried out the work in the Shwe field in block 1-A and Shwe-3. But Frontier Drilling’s management will not supply details about either the Daewoo assignment or the exact time the operations took place.
“The only thing I can say about the case is that the assignment is completed,” Roar Bye, Finance Director in Frontier Drilling, told Norwatch.
“We had a drilling assignment for the Korean company Daewoo and have not entered into an agreement with the military regime in Burma. It was a matter of a small job that consisted of test drilling,” Bye said. He will not state when the assignment was carried out.
Frontier Drilling has its headquarters in Bergen but is today a wholly owned subsidiary of FDR-Holdings, which is registered in the Cayman Islands. The company is owned by several US fund managers.
Contract with Junta Company
All of the promising Shwe field was opened for drilling with the blessing of the junta and will considerably increase the military regime’s revenues. Daewoo expects that production in the field will be started in 2010.
It was in August 2000 that Daewoo signed a contract with the Burmese Myanmar Oil and Gas Enterprise (MOGE), which is a subsidiary wholly owned by the Burmese military junta. Daewoo is the chief operator, but also included are Korean Gas Corporation (KOGAS) and two Indian companies: Gas Authority of India (GAIL) and ONGC Videsh. In 2004 Daewoo found enormous amounts of gas in the Shwe field, at that time valued at approximately US$19 to 20 billion. New finds were made in 2005.
The gas project has given rise to protests from Burmese in exile, human rights organisations, and environmental activists. As late as April 2006 there were protests in India against the agreement to build a new pipeline between India and Burma for gas from the Shwe field. Norwegian authorities have, for their part, several times discouraged Norwegian trade and industry from operating in Burma.
Decision Made Outside Norway
Norwatch asked Financial Director Roar Bye whether they made any political or ethical assessments before entering into the contract with Daewoo.
“That resolution was made by decision-makers outside Norway,” Bye said and would not comment further about the contract.
Bye has no knowledge of whether new agreements have been entered into with Daewoo about other assignments in the ocean area offshore Burma. “Our ships are in any case booked up in other projects for a long time in the future,” Bye said.
“As financial director in the company, what is your opinion of this supply contract with Daewoo, which in turn collaborates with the junta?”
“I have no official opinion about it,” Bye stated.
“Whom can I talk to outside Norway to obtain a statement?”
“You will not obtain any comments. It is their policy never to make statements about anything at all,” Bye claimed.
Frontier Drilling ASA was established in 1997 by, among others, Idar A. Iversen. The firm has its headquarters in Bergen but is today a wholly owned subsidiary of FDR-Holdings Limited. The firm also has offices in Vittoria in Brazil and in Singapore.
A few years ago the company had big problems and was bought by private American fund managers. The company left Oslo Stock Exchange in 2004, and the new owner, FDR-Holdings, was registered in the Cayman Islands.
FDR-Holdings is consequently controlled by private American funds. These funds include Carlyle/Riverstone – that is, The Carlyle Group of Washington, D.C. (Carlyle), and Riverstone Holdings LLC of New York, N.Y. – and the New York-based finance and investment bank Credit Suisse First Boston (CSFB).