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Kværner takes assignment for Burmese gas project

In 1997, Kværner R. J. Brown in Singapore signed a contract with the British company Premier Oil, which is operator on the Burmese gas field Yetagun, in a joint venture with, among others, the oil company of the military dictatorship. Already in 1996, the Norwegian government urged Norwegian companies not to have commercial relations with Burma, and last year Kværner Energy announced that they did not want to get involved in the country. At the same time, however, another branch of the company was working on the Yetagun project. Kværner gave priority to the good relationship with the contractor, instead of complying with the government's request to boycott Burma.
Artikkelen er mer enn to år gammel. Ting kan ha endret seg.
In 1997, Kværner R. J. Brown in Singapore signed a contract with the British company Premier Oil, which is operator on the Burmese gas field Yetagun, in a joint venture with, among others, the oil company of the military dictatorship. Already in 1996, the Norwegian government urged Norwegian companies not to have commercial relations with Burma, and last year Kværner Energy announced that they did not want to get involved in the country. At the same time, however, another branch of the company was working on the Yetagun project. Kværner gave priority to the good relationship with the contractor, instead of complying with the government's request to boycott Burma.


By Morten Rønning
Norwatch

The contract which was given to the subsidiary 100% owned by Kværner, worth 10 million US$, concerned design of the top deck and modules for the gas production platform, as well as assistance during construction. The work was completed in 1998. The main contractor, the Singaporean company Sembawang Marine and Offshore Engineering (SMOE), was in charge of the construction of the platform, which was done at a shipyard in Singapore, according to Graham Hill at Kværner E&C in Singapore. He also informs that this is the company's only contract in Burma so far.

Vice president, corporate communications Marit Ytreeide in Kværner said to the Norwegian newspaper Klassekampen that the company gave priority to the good relationship with the Singaporean shipbuilding company which was in charge of the construction, rather than complying with the boycott request from the Norwegian government. She refused to give an opinion on whether it was right or wrong to take the assignment for the Yetagun field.

Vital activity
The oil and gas activity has become a vital business for the pressured military junta in Burma. The regime is under hard pressure from the international community, and many companies choose to withdraw from the country. Within oil and gas, however, there is a heavy presence of foreign companies. The French company Total, American Unocal and British Premier Oil have been criticized at home for their activity, and the two first mentioned are boycotted internationally because of their presence in the country. Unocal has had big problems in the home market, and has started to call itself an "international" company. It has also established a second head office in Malaysia.

The oil company of the military dictatorship, Myanma Oil and Gas Enterprise (MOGE), has a 15% share in the Yetagun field in the Martaban gulf. Texaco withdrew from Burma and the Yetagun field in 1997, after strong international pressure. Premier, which was already involved in the project, took over Texaco's share and sold it to the national Malaysian oil company Petronas.

At the same time, Premier Oil took over the operator responsibility of the field. At the time, Nobel peace price laureate Aung San Suu Kyi commented on Premier Oil's operations.

- Premier oil not only supports the military government financially, it also gives moral support and does democracy a disservice. They should be ashamed of themselves, said Suu Kyi at a meeting with Premier Oil, arranged by Burma Action Group in 1998.

"I don't think I shall have an opinion on whether this was right or wrong."
Vice president, corporate communications Marit Ytreeide, Kværner.

Boycott
The Norwegian government, and prime minister Kjell Magne Bondevik in particular, has on several occasions urged Norwegian companies not to get involved in Burmese business. The first time this happened was in 1996. When NorWatch reported last year that Kongsberg Simrad would attend an oil and gas expo in Rangoon, hectic communication between the prime minister, the minister of trade and industry and the company made Kongsberg Simrad decide to stay at home (NW 5/98).

Both Kværner Energy and Kværner Process System Asia Pacific participated at the military junta's expo for oil and gas activity in Rangoon in 1996. The British company John Brown Engineering, which was later bought by Kværner, was also present at the conference. Among the visitors was the entire top management of the military junta, including general, prime minister and chairman of the junta (SLORC), Than Shwe.

Double standards
When NorWatch talked to Trygve Haug in the energy division in Kværner about the participation at the conference, Haug said that the company shortly after the conference decided not to invest or participate in the country. Almost simultaneously, Norway's consul general to Burma, James Leander Nichols, was arrested for "illegal use of a fax machine". According to a fellow prisoner, Nichols was tortured and ill-treated in the prison, where he later died.

Haug said to NorWatch that Nichols' arrest was one of the factors that led to Kværner's decision. At the same time, Kværner's Singapore based company, Kværner R. J. Brown, worked on a contract for the Yetagun construction.

" Premier oil not only supports the military government financially, it also gives moral support and does democracy a disservice. They should be ashamed of themselves."
Aung San Suu Kyi about the operator of the Yetagun field, 1998.

Disputed pipeline
The gas from the Yetagun field will, along with the gas from the Yadana field, be exported in a separate, parallel pipeline to Thailand. The pipeline, which crosses the southern part of the country, will lead the gas to the Ratchburi Power Plant in Thailand, which will make use of it.

The pipeline, which is constructed by Total, Unocal, and by the national Thai oil authorities PTTEP and MOGE, is probably this decade's most disputed business project in the world. So far, Premier Oil has not been exposed to the same strong pressure as Unocal and Total.

There have been innumerable reports on human rights violations in connection with the construction of the first pipeline, both with regard to the already pressured karen population in the border area, and use of forced labour on the pipeline.

The military junta, SPDC (The state peace and development council), formerly called SLORC, defines this work as "national communal work". People who have fled from forced labour and Amnesty International give a very different account of the situation. In August 1998, ILO published a report on the use of forced labour in Burma, based on ILO convention no. 29, and concluded that SPDC was "guilty of an international crime which is also, if carried out extensively and systematically, a crime against humanity".

In 1995, Burma signed the international convention against forced labour, but this has not been followed up by the military junta. When the country was admitted into The Association of South-East Asian Nations (ASEAN) in 1997, many people hoped that this might improve the human rights situation in the country. According to Amnesty, the opposite has happened.

Also on the Thai side of the border, the pipeline has caused problems. In January 1998, local environmental organisations started a series of protests and actions against the pipeline, which among other things crosses a national park. Amnesty International reported that leaders of the protests had received anonymous threats to their lives. After a hearing on the pipeline had been carried out, Thailand's prime minister decided in March that year that the work should continue, only with minor corrections. The decision led to several protests and following arrests. 

Kværner R. J. Brown, Singapore
In 1997, Kværner R. J. Brown won a contract to design the top deck and modules for a gas platform from a consortium led by the British company Premier Oil. The platform will extract gas from the Burmese Yetagun field, and the national Burmese oil company Myanma Oil & Gas Enterprise owns 15% of the consortium. According to the plan, the gas production will start in April next year, and it is expected that more than 5 million m3 of gas will be produced per day. Most of the gas will be exported to Thailand.

Norwatch Newsletter 13/99

- Annonse -