Natural Resources and Violent Conflict - WaterWiki.net

attracting reputable companies 341bloody popular protests demanding democratic reform. These led tothe seizure of power by a new military junta, the State Law and OrderRestoration Council (SLORC), which began to open up the country toforeign investment once more.International companies saw a combination of political and technicalopportunity. In the late 1980s and early 1990s several internationalcompanies took advantage of the country’s new economic policies to reviveonshore oil and gas exploration. They hoped that new technologywould enable them to find and develop reserves that had been neglectedduring the colonial period. Onshore exploration proved disappointing,but there have been significant offshore gas finds. The main market forthe gas is in neighboring Thailand.Currently, there are two offshore gas fields. The Yadana field is operatedby the French company TotalFinaElf (31 percent), Unocal (UnitedStates, 28 percent), PTT Exploration and Production (Thailand, 26 percent),and Myanmar Oil and Gas Enterprise (15 percent). Investment inthe field is on the order of $1.2 billion, and it is expected to bring the governmentannual royalties of some $100 million. The Yetagun field is operatedby a joint venture of Petronas (Malaysia), Nippon-Mitsubishi Oil(Japan), and Myanmar Oil and Gas Enterprise. The field was originallyoperated by the U.S. company Texaco, which withdrew in 1998. Premier(United Kingdom) then took over, but itself withdrew in 2002.Political Risks. International companies in Myanmar face a varietyof risks arising from the country’s unresolved political dilemmas.There are two overriding issues: the prospects for national democraticreform and the relationship between the majority Burman populationand the country’s many ethnic minorities, who together make up some35 percent of the population. Political uncertainty will continue tohamper economic development until these issues are resolved.SLORC promised to introduce democratic reform and held multipartyparliamentary elections in 1990. The opposition National Leaguefor Democracy won a sweeping majority. However, SLORC preventedthe new Parliament from convening, and opposition leader Aung SanSuu Kyi was placed under house arrest. More recently, intermittenttalks have been taking place between Aung San Suu Kyi and themilitary leadership (now renamed the State Peace and DevelopmentCouncil). Both sides have expressed optimism that it will eventually bepossible to achieve some kind of settlement but, at the time of writing(February 2003), there had been no breakthrough.The unresolved national political debate creates risks for internationalcompanies at several levels. First, a future democratic regime may