Revealed: how world’s biggest fossil fuel firms ‘profited in Myanmar after coup’ (The Guardian, 01/02/23)

Leaked tax records suggest subsidiaries of international gas field contractors continued to make millions after the coup.

In the two years since a murderous junta launched a coup in Myanmar, some of the world’s biggest oil and gas service companies continued to make millions of dollars from operations that have helped prop up the military regime, tax documents seen by the Guardian suggest.

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Amid this violence, leaked Myanmar tax records and other reports appear to show that US, UK and Irish oil and gas field contractors – which provide essential drilling and other services to Myanamar’s gas field operators – have continued to make millions in profit in the country after the coup.

The documents were obtained by transparency non-profit Distributed Denial of Secrets and analysed by Myanmar activist group Justice For Myanmar, investigative journalism organisation Finance Uncovered and the Guardian.

The documents suggest that in some cases the subsidiaries of major US gas field service firms continued working in Myanmar – even after the US state department warned in January last year there were significant risks in doing business in the country – including with state-owned entities that financially benefit the junta, such as the national oil and gas company Myanma Oil and Gas Enterprise (MOGE).

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Last February the European Union became the first jurisdiction to announce sanctions against MOGE itself in light of the “intensifying human rights violations in Myanmar” and the “substantive resources” MOGE provides the junta.

The EU sanctions prohibit European companies from working on Myanmar’s oil and gas field projects. But the US and UK have not yet introduced similar measures and such work – which may involve direct or indirect dealings with MOGE – is not prohibited.

Among the findings, the leaked tax documents show that:

• US oil services giant Halliburton’s Singapore-based subsidiary Myanmar Energy Services reported pre-tax profits of $6.3m in Myanmar in the year to September 2021, which includes eight months while the junta was in power.
• Houston-headquartered oil services company Baker Hughes branch in Yangon reported pre-tax profits of $2.64m in the country in the six months to March 2022.
• US firm Diamond Offshore Drilling reported $37m in fees to the Myanmar tax authority during the year to September 2021 and another $24.2m from then until March 2022.
• Schlumberger Logelco (Yangon Branch), the Panama-based subsidiary of the US-listed world’s largest offshore drilling company, earned revenues of $51.7m in the year to September 2021 in Myanmar and as late as September 2022 was owed $200,000 in service fees from the junta’s energy ministry.

The services provided to Myanmar’s Asia-owned gas field operators by these companies gave vital support to MOGE, which is a major shareholder in all of the country’s most important oil and gas projects.

MOGE collects taxes and royalties for the state on gas field projects, ensuring that the junta gets lucrative tax and royalty payments, as well as a vast share of profits. According to the junta’s own figures the oil and gas industry is its biggest source of foreign-currency revenue, bringing in $1.72bn in the six months to 31 March 2022 alone.

Yadanar Maung, Justice For Myanmar spokesperson [said]... “These companies have breached their international human rights responsibilities and may be complicit in the junta’s war crimes and crimes against humanity by servicing oil and gas projects that fund the junta’s atrocities.”

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The major gas projects in which MOGE has significant shareholdings are run by the South Korean corporation Posco International, Thailand’s PTTEP and Gulf Petroleum Myanmar, also from Thailand. Gulf Myanmar Petroleum, PTTEP and Posco were contacted for comment.

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Baker Hughes told the Guardian its contracts were signed before the coup and completed in early 2022. The company said it had not signed new contracts since the coup and had “a very limited number of personnel in the country to support critical safety and operations needs”.

Halliburton, Schlumberger and Diamond Offshore Drilling did not respond to repeated requests for comment.

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The tax documents suggest Intermoor, a subsidiary of UK-based Acteon, a subsea services company, also continued to profit from work in Myanmar until at least February 2022.

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Neither Intermoor nor its parent company, Acteon Group responded to repeated requests to comment on this story.