Posco International Reviewing Dividend Payments on Myanmar Gas Project
SEOUL (Reuters) — South Korea's Posco International said on Friday it is reviewing dividend payments on a gas project in Myanmar, in a move that could further constrain funding to the military junta, which seized control of the country in a Feb. 1 coup.
The move follows a decision this week by Total and Chevron that suspended some payments from a similar gas joint venture that is also part-owned by the state-owned gas enterprise.
International firms doing business in the country have come under pressure from rights groups and Myanmar's deposed civilian government to review their operations since the coup and an ensuing bloody crackdown on protests in which hundreds have died. The oil and gas sector is one of the largest sources of foreign revenue for the country.
"We are reviewing what has been demanded for us to do from the international community, and that includes suspending dividend payout. This internal discussion is taking place from various angles, and its not an easy one when the contract involves many," a Posco International spokesman told Reuters by phone, when asked about its gas venture in Myanmar.
Posco International has a majority stake in Myanmar's Shwe gas project, which comprises three fields in the Bay of Bengal, alongside the Myanmar Oil and Gas Enterprise (MOGE), India's Oil and Natural Gas Corp (ONGC) and GAIL. It also has a stake in the pipeline that transports the gas to China.
Posco International had invested about $1.53 billion in the gas project and about 20% of the gas business is used for local consumption including electricity production, while the rest goes to China through pipelines, according to the company.
A spokesman for Myanmar's military government did not answer phone calls seeking immediate comment.
Kinam Kim, a human rights lawyer at Korean Civil Society in Support of Democracy in Myanmar, a rights group, said the move didn't go far enough.
"The military's crimes are bankrolled by oil and gas. Posco must act now to suspend all payments to the junta," said Kinam Kim, a human rights lawyer and spokesman for the organization.
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