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Jubilant Energy to Invest $80 million in Myanmar Oil, Gas Block

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Jubilant Energy plans to invest about to $80 million on an onshore oil and gas block in Myanmar, media reports said Tuesday.

Myanmar recently awarded 10 onshore oil and gas blocks.

“We had bid for two blocks. They have offered us one, but we are keen for both. We are still negotiating,” Chief Financial Officer Vipul Agarwal told Reuters.

The production sharing contract for the block will likely be signed in two to three weeks, he said.

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The Coalition Against Chinese Hegemony

To resist Beijing’s maritime claims, Asean members will have to compromise and form a common front.

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By PHILIP BOWRING

Manila

Ownership of the islands, seabed resources and navigation rights in the South China Sea is now very much on the international agenda. The Association of Southeast Asian Nations is more united on this issue than it has been for about a decade, and the U.S. is turning more attention diplomatically and militarily to the Pacific. Nevertheless, sustaining the coalition of interests disputing China’s claimed hegemony over the sea will not be easy.

In fact, the wonder is that the Chinese leadership managed to get itself into this predicament by so clumsily arousing neighboring countries’ fears. Having suffered constant Chinese provocations over the preceding few years, Hanoi used its chairmanship of the Association of Southeast Asian Nations in 2010 to first bring the issue of Chinese aggression to the table. Vietnam and the Philippines encouraged the U.S. to make clear its own interest in freedom of navigation and settlement of territorial disputes according to international principles.

At that point Beijing could have backed off and allowed the subject to fade from view. Instead, the People’s Liberation Army tried to punish Vietnam and the Philippines by harassing their exploration ships. Under the confident new administration of President Benigno Aquino, Manila responded with unprecedented vigor, carrying on exploration and offering new blocks for drilling.

Even this has not given China’s nationalists second thoughts. Recently the Global Times newspaper, owned by the People’s Daily, warned those who dispute Chinese claims to be “mentally prepared for the sound of cannons,” a threat that was noted around the world.

There is a sense that China’s provocations have been driven by the military, probably against the advice of its diplomats. If wiser heads among Beijing’s civilian leadership can reassert control, they will re-adopt Deng Xiaoping‘s maxim about keeping a low profile. If so, China will tone down its rhetoric and offer economic benefits on a larger scale to increase its neighbors’ dependence. It will likely quietly offer bilateral exploration deals which would divide the Asean claimants who are just starting to work together.

China has tried this before and nearly succeeded with Manila. Although the Philippines has relatively little reliance on China trade, its need for investment and pervasive corruption are vulnerabilities. The preoccupation of its armed forces—who are anyway poorly equipped—with insurgencies at home limits its ability to police the seas and protect exploration.

However, democracy can be a powerful force when it comes to protecting national interests. The Philippine public’s determination to stand up to bullying can be stronger than that of elites with business deals with China or autocracies reliant on good relations.

Vietnam’s nationalistic instincts are sure enough but Vietnam is still a relatively small and weak nation quite dependent on trade with China and likely to become more so. Good ties with India, Japan and Russia and emerging ones with the U.S. are an offset but China’s threats have already deterred some exploration on the continental shelf.

China’s efforts to divide the littoral states by pressing for bilateral negotiations have so far not met with success. But they could do so if Vietnam, the Philippines, Malaysia and Brunei do not resolve their own differences. Significantly, China has refrained from overt threats against Malaysia even though oil and gas wells off Borneo are within its claimed territory. Malaysia in return has urged caution and cooperation with China. If Vietnam and the wider Malay world do not hang together they will surely be hung separately.

The difficulty lies in sacrificing some overlapping claims to form a united front. Vietnam claims all the Spratlys, the Philippines most but not all of them, Malaysia just a few, and Brunei only a couple of banks. Many of the islets, rocks and reefs lie outside their 200-mile exclusive economic zones and none qualifies for its own EEZ as none is capable of independently supporting permanent habitation.

Vietnam’s claim is as successor to its French colonial rulers as well as Vietnamese imperial assertions and the legacy of the Cham trading kingdom which flourished in central Vietnam until about 1500. The U.S. never claimed the Spratlys but an independent Philippines did so on the basis of proximity and as part of the Philippine archipelago. Malaysia and Brunei make claims based on rights to the continental shelf off Borneo.

Compromise among these four countries, who together own two-thirds of the coastline, is essential to prevent China from establishing hegemony over Southeast Asia. If the Asean nations cannot agree among themselves they could ask the International Court of Justice for a ruling, as did Malaysia, Singapore and Indonesia in previous island disputes. The court could also be asked to adjudicate the EEZ boundaries. China would object, but that would only underline its unwillingness to agree to arbitration based on the U.N. Law of the Sea Convention.

In the end, only leadership from Indonesia, the largest Malay state and the cornerstone of Asean, can resolve this conflict. It can do more to refute China’s history-based claims, which ignore centuries of Malay trading across the sea a thousand years before the Chinese. And Jakarta can be the honest broker in finding a compromise to share resources that lie outside the EEZs of the claimants.

Vietnam, the Philippines and the other smaller states are never going to be able to remove China from the Spratly Islands that it now occupies, let alone the Paracels that it seized from Vietnam in 1974. But if they can maintain a common front with backing from Indonesia, they should be able to defend their interests in the South China Sea and their future sovereignty.

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Burma Today

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Darlene Casella
November 22, 2011

Evolved from the colonial poems of Kipling to the specter of nuclear weapons, world leaders are taking a renewed look at provocative Burma.

Rudyard Kipling wrote The Road to Mandalay; a poem about the sometime capital of the British Colony, Burma.

“Come you back to Mandalay, Where the old Flotilla lay:
Can’t you ‘ear their paddles chunkin’ from Rangoon to Mandalay on the road to Mandalay,
Where the flyin’ fishes play,
An’ the dawn comes up like thunder outer China ‘crost the Bay!”

Kipling’s poem became a song for Paramount’s first “Road “picture, with Bing Crosby and Bob Hope. The Road to Mandalay was renamed The Road to Singapore. Frank Sinatra made the song a hit in his Come Fly With Me album.

Songs and laughter are not the reality of Burma today. Myanmar was renamed after the brutal uprising in 1998. Yangon, formerly Rangoon, means “End of Strife.” This name is an antonym to Burmese life. Pervasive government control, electricity and food shortages, corruption and rural poverty abound. State assets have been “privatized” to military families and government cronies. In spite of abundant natural resources, Burma remains one of the world’s poorest countries.

Human trafficking of women and children for commercial sexual exploitation; conscription of child soldiers, and forced labor camps are found. Extreme human rights violations cause the United States, the European Union, and Canada to impose financial and economic sanctions.

Myanmar sits at the crossroads of Asia’s great civilizations between India, Bangladesh, Laos, China, and Thailand. Strategically located on the vast Indian Ocean; she stretches to the Eastern Himalayan Mountains, but is smaller than Texas.

Ancient cities, spectacular monuments, well preserved pagodas, stupas, and temples make Myanmar a rich archaeological find. People communicate in their own languages, wear their own style of clothing, celebrate festivals, and perform rituals that have existed since time immemorial. Buddhism is influential. Most boys, and many girls, take part in novitiation which is a temporary monastic life; which includes a shaved head, wearing a robe, and staying in a monastery (a nunnery for girls). Monks in yellowish robes hold alms bowls, heads bowed, humbly asking for whatever food is offered.

The George Soros Foundation created The Burma Project in 1994 to increase international awareness of conditions in Burma and help the country to make transition from a closed to an open society.

Aung San Suu Kyi is a Burmese national hero, a Noble Laureate, and head of the pro democracy movement. She was under house arrest for most of the last 20 years; during this time her husband died in England. At the age of 65, she was released in November 2010 and saw her son for the first time in ten years. Bono wrote the song “Walk On” for Kyi. She has millions of supporters worldwide.

Former First Lady Laura Bush, an advocate of Suu Kyi, worked with 16 women senators to draft a letter to the UN to secure Kyi’s release. Mrs. Bush wrote an op-ed piece in the Wall Street Journal, was interviewed in Time Magazine, and personally called General Secretary Ban Ki Moon asking him to pressure the Burmese regime to release Suu Kyi. In 2010 Laura Bush made a U Tube video about Suu Kyi. Happily Laura Bush spoke by phone with the recently freed pro democracy activist. Encouraged by recent developments, Aung San Suu Kyi announced a return to politics. She had meetings with President Thein Sein.

Burma remains a close ally of China. China and Myanmar have multibillion dollar joint venture pipelines to transport oil and gas. It will link refineries in Western China across Myanmar. Offshore natural gas will go to China. Under civilian control since March 2011, Myanmar has embarked on a series of reforms; released 220 political prisoners, relaxed media control, and legalized trade unions. Association for Southeast Asian Nations (ASEAN) has named Burma as the Chair starting in 2014. UN Secretary General Ban Ki Moon has accepted an invitation to visit the country as soon as possible.

Troubling aspects of Sein’s new government include their nuclear ambition, and their military relationship with North Korea. Norway based “Voice of Burma” broadcast this in a one hour documentary film on Aljazeera television in the Middle East. A young Burmese military specialist on rocket engines shows that Burma has components for a nuclear weapons program, including technology for uranium enrichment and long range missiles.

President Barack Obama and Secretary of State Hillary Clinton are climbing on the Burma bandwagon. Mr. Obama called Aung San Suu Kyi during his visit to Australia last week. Hillary Clinton is scheduled to visit next month.

Let us pray that the Obama Administration does better with nuclear weapons in Burma than it has done with nuclear weapons in North Korea and Iran.

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ASEAN gambles on Myanmar’s regional leadership

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By Ben Blanchard
NUSA DUA, Indonesia

(Reuters) – Southeast Asian nations endorsed Myanmar Thursday for the chairmanship of a key regional grouping, gambling that the isolated country can stick to reforms begun this year that could lead it out of half a century of isolation.

But U.S. President Barack Obama cautioned that Myanmar, also known as Burma, must still demonstrate improvements in human rights in his first remarks since the authoritarian regime freed hundreds of political prisoners in October and vowed more reforms in the weeks ahead.

“Some political prisoners have been released. The government has begun a dialogue. Still, violations of human rights persist,” Obama said in a speech to the Australian parliament

ahead of joining Asian leaders in Bali for an East Asia Summit.

“So we will continue to speak clearly about the steps that must be taken for the government of Burma to have a better relationship with the United States.”

The United States has said that freeing political prisoners is one of several preconditions to lifting sanctions that have isolated Myanmar and driven it closer to China. Other conditions include peace with restive ethnic groups after years of unrest.

But Southeast Asia has moved quickly to embrace change in the resource-rich former British colony, whose strategic location between rising powers India and China, and vast, untapped natural-gas resources, have drawn investor interest.

The 10-member Association of South East Asian Nations (ASEAN) — of which Myanmar is a member — formally gave Myanmar the chairmanship of the Southeast Asian regional bloc in 2014, two years ahead of schedule, said Myanmar government officials at an ASEAN summit on the Indonesian resort island of Bali.

“Be assured that we are now growing into a democratic society and we will do all our responsibilities and duties as a responsible government, reflecting the desires of the Myanmar people,” Ko Ko Hlaing, chief political adviser to the Myanmar president, told reporters.

“We will do what we have to do as a democratic government and a democratic society,” he said. “As a family, ASEAN nations have welcomed Myanmar to be a responsible chairman.”

U Sit Aye, a senior Myanmar presidential legal advisor, said more reforms were in store.

“It is . a continuing process,” he said, adding that ASEAN leaders had formally backed Myanmar’s chairmanship at a closed-door meeting in Bali.

Countries across Southeast Asia welcomed the chairmanship as a critical milestone after years frustration over Myanmar’s isolation as the region approaches a European Union-style Asian community in 2015.

“We believe that with the positive improvements in Myanmar right now, this has shown that Myanmar would like to come back to the democratic way,” Thai Foreign Minister Surapong Towijakchaiku told reporters on the sidelines of the ASEAN summit in Bali.

“MOMENTUM FOR REFORMS”

Recent overtures by Myanmar’s government have included calls for peace with ethnic minority groups, some tolerance of criticism, the suspension of an unpopular Chinese-funded dam project and the legalization of labor unions.

President Thein Sein has also reached out to democracy leader Aung San Suu Kyi, who was freed last year from 15 years of house arrest. Her National League for Democracy (NLD) is expected to decide on Friday whether to re-register as a political party to contest imminent by-elections.

An official in Suu Kyi’s party said Myanmar’s expected ASEAN chairmanship would help to drive more political change.

“Their decision is tantamount to encouraging the present Myanmar government to step up the momentum for reforms,” Nyan Win, a senior NLD official, told Reuters. “Myanmar’s political activities will become more vibrant after assuming the chair.”

Indeed, Indonesia’s foreign minister, Marty Natalegawa, said the chairmanship would likely open Myanmar further. “I am quite convinced this will have a huge multiplier effect.”

“REAL CHANGES”

The United States has had strained relations with Myanmar since the former military junta, which took power in a 1962 coup, killed thousands in a crackdown in 1988. The junta was replaced by a military-dominated civilian government in March after the first elections in two decades last year.

U.S. Secretary of State Hillary Clinton said last Friday that Myanmar appeared to be making some “real changes” to its political system but needs to pursue more reform.

Myanmar’s government has responded by urging the United States to lift sanctions, describing its reforms as genuine.

The country, as big as France and Britain combined, is developing ports on the Indian Ocean and Andaman Sea that, if combined with proposed rail and pipeline projects, would allow cargo ships to bypass the Straits of Malacca.

That would open the way for faster delivery of oil from the Middle East and Africa to China and other countries in the region straddling the Mekong River.

India, Japan and Southeast Asia have sought to ramp up engagement, largely to counterbalance China’s influence and to gain a toehold in a country whose proven gas reserves have tripled in the past decade to around 800 billion cubic meters, equivalent to more than a quarter of Australia’s, BP Statistical Review figures show.

(Additional reporting by Michael Perry, James Grubel and Caren Bohan in Canberra and Aung Hla Tun in Yangon; writing by Jason Szep; editing by Neil Fullick.)

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Tensions rise on South China Sea dispute

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Tom Allard
November 17, 2011

TENSIONS over the oil-rich and strategically important South China Sea escalated yesterday, as Chinese state media accused the US and the Philippines of planning a ”grab” for its resources and a senior foreign ministry official said it did not want the issue discussed at this week’s East Asia Summit in Bali.

Meanwhile, US Secretary of State Hillary Clinton said yesterday in Manila that the US ”will certainly expect and participate in very open and frank discussions” on the topic at the summit, which will be attended by US President Barack Obama, Chinese President Hu Jintao and Prime Minister Julia Gillard.

The looming confrontation over the South China Sea threatens to overshadow the East Asia Summit, a grouping of nations based on the south-east Asian countries of ASEAN that has emerged as the prime forum for security and political discussions in the Asia-Pacific region.

The South China Sea is a potential flashpoint between the US and China as the two powers seek to assert their interests in Asia, the fastest-growing region in the world.

The US has leapt on nervousness among smaller Asian nations about China’s growing military might and bellicose diplomacy to reassert its long-standing role as an anchor of security in Asia, even as its economic importance wanes. Before Mrs Clinton’s visit to Manila and the East Asia Summit, which the US will attend for the first time, China’s state-run Xinhua news agency said: ”Now that Obama is scheduled to appear at the ASEAN Summit, the Philippines will embrace the ‘golden chance’ to get back at China, again churning up the South China Sea.”

The Global Times, another Chinese government mouthpiece, said the Philippines, aided and abetted by the US, was intent on ”grabbing resources from Chinese water”. ”We hope the South China Sea will not be discussed at the East Asia Summit,” Chinese Vice-Foreign Minister Liu Zhenmin said.

Mrs Clinton yesterday signed a declaration with her Philippines counterpart, Albert del Rosario, aboard the guided missile destroyer USS Fitzgerald in Manila Bay, to boost defence co-operation between the two countries and calling for multilateral talks on the South China Sea.

The Philippines is one of six countries claiming part or all of an archipelago in the South China Sea known as the Spratly Islands, which are believed to lie above significant oil and gas reserves. The area is also of high strategic value as a vital sea lane for much of the world’s trade.

This year, Chinese and Philippines naval ships have had skirmishes with fishermen and other vessels each country believed had been encroaching on its territory.

While many of the claimants – which also include Vietnam, Malaysia, Taiwan and Brunei – want multilateral talks to solve the dispute, China insists on one-on-one negotiations.

Burma is set to chair the 2014 ASEAN and East Asian summits after members said its political reforms meant it was now a suitable candidate for the role.

The US, Australia and other participants still have sanctions in place against Burma but have cautiously welcomed the release of political prisoners and other reform in a country that was run by a military junta for decades until elections this year.

ASEAN foreign ministers ”all recognize the important and significant developments taking place in [Burma]”, Indonesian Foreign Minister Marty Natalegawa said.

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Clinton in Manila amid ASEAN row over South China Sea

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By Manuel Mogato and Paul Eckert

(Reuters) – The Philippines criticized fellow Southeast Asian nations on Tuesday for failing to take a united stand against China over maritime rights in the South China Sea, a crucial commercial shipping lane thought to contain valuable oil and minerals.

The comments by Philippine Foreign Secretary Albert del Rosario coincide with the arrival of U.S. Secretary of State Hillary Clinton in Manila for a two-day visit in which the Philippines is likely to press Washington to help resolve disputes in the sea lanes claimed by China.

“They’re concerned from a security point of view and are looking at us to identify ways to work together,” a senior U.S. defense official travelling with Clinton told reporters. “We’re very sensitive to making sure that this does not in any way alarm or provoke anybody else.”

Regional leaders gather in Bali, Indonesia, this week for back-to-back summits of the ASEAN and East Asia groupings where the issue is also expected to be raised.

The summits follow a meeting in Honolulu this past weekend of leaders of the Asia-Pacific Economic Cooperation forum.

Beijing claims that entire maritime region, which contains rich energy and fisheries resources, pitting it against coastal states Vietnam and the Philippines in a test of wills that erupted in violent clashes in recent years.

Diplomats in Vietnam and the Philippines have privately expressed concern that Beijing is using its economic influence on some members of the 10-state Association of South East Asian Nations (ASEAN) to prevent the regional bloc from steering negotiations over conflicting claims.

The Philippines has proposed a “Zone of Peace, Freedom, Friendship and Cooperation”, or ZoPFFC, to define which areas are disputed and which are under the sovereignty of a country. That would pave the way for a joint cooperation area.

In the first sign of discord as regional foreign ministers met on the Indonesian resort island of Bali, del Rosario reprimanded Southeast Asia, suggesting it was failing to flex its diplomatic muscle in the face of pressure from China.

“We have been given the impression that political and economic considerations have hindered a fruitful and mutually acceptable outcome on the discussions of the ZoPFFC,” Rosario said in a statement in Manila on Tuesday that was read by his deputy at an ASEAN foreign ministers meeting in Bali.

“ASEAN must play a decisive role at this time if it desires to realize its aspirations for global leadership.”

Indonesian Foreign Minister Marty Natalegawa, whose country holds the rotating ASEAN chairmanship, said the Philippine proposal failed to find traction in the region.

“The core problem is to define which areas are in dispute and which areas are not,” he told reporters in Bali. “So to many countries, this almost appeared to be a non-starter.”

OBAMA TO ADDRESS SECURITY

Maritime security will be front and centre when U.S. President Barack Obama attends the East Asia Summit in Bali this weekend, the first U.S. leader to join the annual meeting of Asian leaders and dialogue partners.

Obama is expected to respond to China’s territorial sea claims which the Philippines and other U.S. allies regard as economically and militarily threatening.

Taiwan, Malaysia and Brunei are other claimants to parts of the South China Sea. Those countries, along with the United States and Japan, have pressured Beijing to try and seek some way forward on sovereignty, which has flared again this year with often-tense maritime stand-offs.

But China, growing in confidence and military power, sees no reason to back down.

Countries such as the Philippines are increasingly concerned and fear their Asian allies will succumb to Beijing’s influence on the issue.

Del Rosario said there was no full participation of ASEAN member states in an ASEAN Maritime Legal Experts’ Meeting, making it difficult to reach consensus on the issue.

Manila hosted the legal experts’ meeting in September but Laos and Cambodia — both of which have benefited from waves of Chinese investment in recent years — did not turn up despite indicating they would, preventing a joint position.

“ASEAN is now at a critical junction of playing a positive and meaningful role to contribute in the peaceful resolution of the disputes in the South China Sea,” del Rosario said.

China and Taiwan also claim the whole of the world’s second-busiest sea lane, which has rich deposits of oil and gas and is also a major fisheries resource.

Beijing wants to resolve the dispute through bilateral negotiations and has rejected calls for United Nations arbitration, but other claimants prefer a multilateral approach, including an indirect role for the United States.

Washington has supported Manila’s multilateral and rules-based approach to resolve the issue and has pledged military assistance to upgrade the Philippines’ ability to patrol its maritime borders in the area.

Clinton will sign a partnership agreement to mark 60th anniversary of the countries’ Mutual Defence Treaty.

Briefing journalists travelling with Clinton, a senior U.S. state department official said Washington will continue efforts in the country’s restive south to help fight Islamic militants but “are focusing more on maritime capabilities and other aspects of expeditionary military power.”

“We are working on a whole list of things that improve their own indigenous capabilities to be able to deal with maritime challenges,” he said, adding the U.S. has provided the Philippines with a destroyer and a second ship will come soon.

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