Thailand’s PTT halts fuel storage project in Myanmar, citing unrest
Published on: Saturday, December 24, 2022
By:
Nikkei, FMT
Previously, France’s TotalEnergies announced its withdrawal from Myanmar’s Yadana gas field in March. (AFP pic)
BANGKOK: A subsidiary under Thailand’s state-owned energy giant PTT will suspend oil transport and storage operations in Myanmar over “violence and unrest” in the country, the company announced a week after losing one of the world’s largest sovereign wealth funds as an investor.
The subsidiary, PTT Oil and Retail Business (PTTOR), holds a 35% stake in Bright Energy, a joint venture formed in 2019 with a unit under Myanmar conglomerate Kanbawza Group. Bright Energy had been constructing an oil storage terminal near Yangon, which was expected to be the biggest in Myanmar.
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PTTOR “has expressly declared our intention to suspend BE’s operations and construction and payments,” according to a statement Thursday.
The move comes after Norway’s Government Pension Fund Global removed both PTTOR and the parent PTT from its portfolio, which was announced on Dec 15. The Norway fund is one of the world’s largest sovereign wealth funds.
The business partnerships of the PTT group with companies closely linked to Myanmar’s military risks contributing to human rights violations, the Norway fund’s ethics council said.
“Respect for human rights is one of the PTT Group’s most fundamental practices and PTT is deeply concerned about the atrocities committed in Myanmar,” PTT said in a statement Thursday, responding to the action taken by Norway.
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It remains to be seen if PTT’s downscaling will extend to the remaining natural gas operations in Myanmar. Group company PTT Exploration and Production (PTTEP) controls interests in multiple gas fields in Myanmar and exports the product to Thailand.
Myanmar’s natural gas accounts for about 15% of Thailand’s gas consumption.
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When France’s TotalEnergies withdrew from Myanmar’s Yadana gas field in March, PTTEP announced it would take over part of the stake, adding that “long-term energy security” factored into the decision.
However, PTTEP said in April that it would withdraw from Myanmar’s Yetagun gas project. Yetagun’s gas reserves have dwindled while international criticism has mounted, so there was little advantage to sticking with the project.
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