Page 2 of
2 The geopolitical stakes of 'Saffron
Revolution' By F William
Engdahl
narrowest point is the
Phillips Channel in the Singapore Strait, only 1.5
miles wide at its narrowest. Each day, more than
12 million barrels in oil supertankers pass
through this narrow passage, most en route to the
world's fastest-growing energy market, China, or
to Japan.
If the strait were closed,
nearly half of the world's tanker fleet would be
required to sail further. Closure would
immediately raise freight rates worldwide. More
than 50,000 vessels per year transit
the
Strait of Malacca. The region from Maynmar to
Banda Aceh in Indonesia is fast becoming one of
the world's most strategic chokepoints. Who
controls those waters controls China's energy
supplies.
That strategic importance of
Myanmar has not been lost on Beijing.
Since it became clear to China that the US
was hell-bent on a unilateral militarization of
the Middle East oil fields in 2003, Beijing has
stepped up its engagement in Myanmar. Chinese
energy and military security, not human rights
concerns, drives their policy.
In recent
years Beijing has poured billions of dollars in
military assistance into Myanmar, including
fighter, ground-attack and transport aircraft;
tanks and armored personnel carriers; naval
vessels and surface-to-air missiles. China has
built up Myanmar railroads and roads and won
permission to station its troops in Myanmar.
China, according to Indian defense sources, has
also built a large electronic surveillance
facility on Myanmar's Coco Islands and is building
naval bases for access to the Indian Ocean.
In fact Myanmar is an integral part of
what China terms its "string of pearls", its
strategic design of establishing military bases in
Myanmar, Thailand and Cambodia in order to counter
US control over the Strait of Malacca chokepoint.
There is also energy on and offshore of Myanmar,
and lots of it.
The gas fields of
Myanmar Oil and gas have been produced in
Myanmar since the British set up the Rangoon Oil
Company in 1871, later renamed Burmah Oil Co. The
country has produced natural gas since the 1970s,
and in the 1990s it granted gas concessions to the
foreign companies ElfTotal of France and Premier
Oil of the UK in the Gulf of Martaban. Later
Texaco and Unocal (now Chevron) won concessions at
Yadana and Yetagun as well. Yadana alone has an
estimated gas reserve of more than 5 trillion
cubic feet and an expected life of at least 30
years. Yetagun is estimated to have about a third
the gas of the Yadana field.
In 2004 a
large new gas field, Shwe field, off the coast of
Arakan, was discovered.
By 2002 both
Texaco and Premier Oil withdrew from the Yetagun
project following UK government and
non-governmental pressure. Malaysia's Petronas
bought Premier's 27% stake. By 2004 Myanmar was
exporting Yadana gas via pipeline to Thailand,
worth $1 billion annually to the Myanmar regime.
In 2005 China, Thailand and South Korea invested
in expanding the Myanmar oil and gas sector, with
export of gas to Thailand rising 50%.
Gas
export today is Myanmar's most important source of
income. Yadana was developed jointly by ElfTotal,
Unocal, PTT-EP of Thailand and Myanmar's state
MOGE, operated by ElfTotal. Yadana supplies some
20% of Thai natural gas needs.
Today the
Yetagun field is operated by Malaysia's Petronas
along with MOGE, Japan's Nippon Oil and PTT-EP.
The gas is piped onshore where it links to the
Yadana pipeline. Gas from the Shwe field is to
come on line in 2009. China and India have been in
strong contention over the Shwe gas field
reserves.
India loses, China
wins This past summer Myanmar signed a
memorandum of understanding with PetroChina to
supply large volumes of natural gas from reserves
of the Shwe gasfield in the Bay of Bengal. The
contract runs for 30 years. India was the main
loser. Myanmar had earlier given India a major
stake in two offshore blocks to develop gas to
have been transmitted via pipeline through
Bangladesh to India's energy-hungry economy.
Political bickering between India and Bangladesh
brought the Indian plans to a standstill.
China took advantage of the stalemate. It
simply trumped India with an offer to invest
billions in building a strategic China-Myanmar oil
and gas pipeline across Myanmar from Myanmar's
deepwater port at Sittwe in the Bay of Bengal to
Kunming in China's Yunnan province, a stretch of
more than 2,300 kilometers. China plans an oil
refinery in Kumming as well.
What the
Myanmar-China pipelines will allow is routing of
oil and gas from Africa (Sudan among other
sources) and the Middle East (Iran, Saudi Arabia)
without depending on the vulnerable chokepoint of
the Malacca Strait. Myanmar becomes China's
"bridge" linking Bangladesh and countries westward
to the China mainland independent of any possible
future moves by Washington to control the strait.
India's dangerous alliance
shift It's no wonder that China is taking
such precautions. Ever since the Bush
administration decided in 2005 to recruit India to
the Pentagon's "New Framework for US-India Defense
Relations", India has been pushed into a strategic
alliance with Washington in order to counter China
in Asia.
In an October 2002 Pentagon
report, "The Indo-US Military Relationship", the
Office of Net Assessments stated the reason for
the defense alliance would be to have a "capable
partner" who can take on "more responsibility for
low-end operations" in Asia, provide new training
opportunities and "ultimately provide basing and
access for US power projection". Washington is
also quietly negotiating a base on Indian
territory, a severe violation of India's
traditional non-aligned status.
Power
projection against whom? China, perhaps?
As well, the Bush administration has
offered India a deal to lift its 30-year nuclear
sanctions and to sell advanced US nuclear
technology, legitimizing India's open violation of
the nuclear Non-Proliferation Treaty. At the same
time Washington accuses Iran of violating same, an
exercise in political hypocrisy to say the least.
Notably, just as the saffron-robed monks
of Myanmar took to the streets, the Pentagon
opened US-Indian joint naval exercises, "Malabar
07", along with armed forces from Australia, Japan
and Singapore. The US showed the awesome muscle of
its 7th Fleet, deploying the aircraft carriers USS
Nimitz and USS Kitty Hawk, guided missile cruisers
USS Cowpens and USS Princeton, and no less than
five guided missile destroyers.
US-backed
regime change in Myanmar together with
Washington's growing military power projection via
India and other allies in the region is clearly a
factor in Beijing's policy vis-a-vis Myanmar's
present military junta. As is often the case these
days, from Darfur to Caracas to Yangon, the
rallying call of Washington for democracy ought to
be taken with a large grain of salt.
F William Engdahl is the author
of A Century of War: Anglo-American Oil
Politics and the New World Order, Pluto Press
Ltd. Further articles can be found at his website,
www.engdahl.oilgeopolitics.net.
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