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Mid

China starts building Burma pipeline
Tuesday, 03 November, 2009

China's CNPC started building a crude port in Burma on 31 October, the China Petroleum Daily reported today, part of a pipeline project aimed at cutting out the long detour oil cargoes take through the congested Malacca Strait.

The reported commencement of construction took place at least a month later than scheduled in earlier plans reported by China's state media.

The port on Maday Island, Kyaukphyu Township in Burma's Rakhine state was the starting point for the 771-kilometre pipeline that would have a capacity of 12 million tonnes per year or 240,000 barrels per day in its first phase, the report said.

It did not say when the port facility would be ready for use or when the pipeline would be built.

CNPC also plans a gas pipeline from Burma with capacity of 12 billion cubic metres a year, scheduled to carry natural gas to south-western China in 2012.

Burma activists have called for China to halt construction of the controversial pipelines, warning of instability and civil unrest if Myanmar's ruling junta continues to starve its people of energy.

CNPC, China's largest oil and gas producer, operates most of its domestic businesses via listed PetroChina, while keeping politically-sensitive overseas businesses in its own hand.

China, the world's second-largest oil user, has been keen to diversify its oil import routes, concerned about supply security. Around three quarters of China's oil imports in 2008 were from the Middle East and Africa and most cargos were shipped through the pirate-laden Malacca Strait.

A crude pipeline with an initial capacity of 200,000 bpd started sending oil from Kazakhstan to China's north-west in 2006. A second transnational oil pipeline with a capacity of 300,000 bpd is under construction and expected to pump oil from Russia to northeastern China from late 2010, reported Reuters.

upstreamonline.com

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"Keeping quiet while monks and other peaceful protesters are murdered and jailed is not evidence of constructive engagement." - Arvind Ganesan, Human Rights Watch.

"I think...I think it's in my basement. Let me go upstairs and check" - M.C. Escher

Mid

Weekly Business Roundup (November 7, 2009)
WILLIAM BOOT

French Firm among Developers Moving into Shwe Gas Field

More foreign companies, including a French engineering specialist, have been hired to begin the multibillion dollar development of Burma’s Shwe offshore gas field.

A consortium led by South Korea’s Hyundai Heavy Industries has secured a US $1.4 billion contract from main project controller Daewoo International to build and install a huge 40,000-tonne well platform and pipelines, plus a port terminal.

Hyundai’s chief partner will be Paris-based DORIS Engineering, an offshore gas development specialist.

In addition, the Indian government-owned Oil and Natural Gas Corporation (ONGC), a partner of Daewoo, has disclosed it will invest about $174 million in the Shwe development.

Indian media this week quoted unnamed onGC officials as saying the firm will use its investment for gas production and marketing.

ONGC and another state-owned firm, GAIL, have a combined stake in the Shwe project of more than 20 percent under main shareholder Daewoo, which disclosed recently that a total of $3.2 billion will be spent on bringing the Shwe gas ashore.

India had hoped to buy most of the 200 billion cubic meters in two blocks of the Shwe field, but the Burmese government awarded virtually all of it to the Chinese state-owned China National Petroleum Corporation.



China Confirms its Plan to use Burma as a Mideast Oil Conduit

The state-owned oil giant China National Petroleum Corporation (CNPC) says it has begun constructing an oil pipeline which will run for nearly 800 kilometers through Burma from the Arakan coast to the Chinese province of Yunnan.

Announcement of building work comes as the Chinese state-controlled media also for the first time confirmed that China is constructing an oil transshipment port on Ramree Island in Arakan State.

Beijing claimed that CNPC had “started building” the deep-draft port at Kyaukphyu, when in fact the terminal has been under construction for some time and is reported to be well on the way to completion.

The pipeline will be capable of transporting up to 12 million tonnes of crude oil a year, or 240,000 barrels per day, reported the Chinese official news agency Xinhua.

This also marks the first time that China has confirmed it is using Burmese territory as a short-cut conduit to transit oil supplies from the Middle East and Africa.

The formal announcement comes just days after a coordinated petition campaign by scores of human rights group left protest letters at Chinese embassies in Asia, Australia and Europe urging he Chinese government not to build oil and gas pipelines through Burma.

It was said the groups are “gravely concerned” for communities living along the pipeline routes, citing past examples of abuse by the Burmese military when such projects are developed.

irrawaddy.org

Mid

China’s ‘Business Special’ Train Route into Northern Burma
WILLIAM BOOT
Saturday, November 21, 2009

Proposals by China to finance a railway 100 kilometers into northern Burma appear to be part of Beijing’s efforts to link its landlocked southwestern regions with the sea.

The Chinese are negotiating to build the train route from the Jiegao trading zone on the border at Ruili down to Lashio, the main town in Burma’s Shan State.

A dilapidated railway already links Lashio with the key port of Rangoon in Burma’s south.

Chinese transport ministry officials have visited Burma to discuss the new train line, according to news agency report quoting the Yangon Times.

Ruili is a rough wild west town which has become a transit point for both legal and illegal business in Burma for many Chinese.

In April this year, China pledged infrastructure aid totaling US $39 million for roads and railways in Burma and Laos—money which will also benefit China’s trade links to the sea.

irrawaddy.org

Mid

Gas ‘Demand’ in Burma to Double as Fuel Piped Abroad
WILLIAM BOOT
Saturday, November 21, 2009

The state Myanmar Oil and Gas Enterprise (MOGE) has confirmed that only about 160 million cubic feet a day (c.f.d.) of gas from two major new production fields will go towards easing Burma’s acute power shortage.

At the same time, MOGE admitted that Burma’s domestic gas “demand” from consumers will more than double, from 200 million c.f.d to 500 million c.f.d. No timetable was given.

The figures were presented at an international oil and gas industry conference led by the Association of Southeast Asian Nations in Bangkok this week.

The 160 million c.f.d. will come from the 800 million c.f.d forecast to flow from new gas blocks being developed in the Shwe field in the Bay of Bengal and the Zawtika block in the Gulf of Martaban.

Most of the gas, to be produced from 2013, will be sold to China and Thailand.

Burma’s gas exports “earned the country” US $1.2 billion in the first five months of the current financial year which began in April, according to Rangoon’s Myanmar Times.

Human rights and democracy groups allege that most of this money is pocketed by the military regime and secreted in bank accounts outside Burma.

irrawaddy.org

Norton

Clearly the Chinese have decided it far more economical to feed their huge energy needs by bringing oil, gas and other products from a deep water port in Burma via a land route through Burma, Thailand and Laos. This has to be disturbing to Singapore as they will lose significant shipping revenue.

As they have demonstrated even in China, the toll their development takes on the human rights of these countries citizens is secondary to China's economic goals.

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There is such a thing as a nation being so right that it does not need to convince others by force that it is right.

Woodrow Wilson

Mid

^

also has the added benefit of supplying immunity from a Malacca Straits blockage ..........................

Norton

Indeed. There is one catch though. The Chinese will be in a position where they will have to make sure relations are kept on a "friendly" basis with the countries where the land crossings reside. The Russians problems with gas pipeline via the Ukraine come to mind.

Mid

suspect the Junta feel they have the upper hand , doubt the deal would have been done else wise .................

Norton

For now but they are not dealing with babes in the woods. Dealing with China carries some big potential risk to the junta.

Mid

there's an elephant in the room fur sur ..............

doubt the west would allow a Chinese annexation of Burma so their actual threat maybe perceived rather than actual ?

Norton

Annexation no option but once all the infrastructure they need is in place the Chinese may decide it is in their best interest to support a "democratically" elected government in Burma.

harrybarracuda

The fucking frogs will do anything for money, won't they.

Bastards.

Mid

support a "democratically" elected government

your right of course , but hell we've seen that before , never as a successful long term option .

Norton

They will but they are not the only ones. The multinationals doing business in Burma are many. When it comes to making money, all suddenly lose any sense of moral obligation.