December 14, 2017
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Tests begin on Shwe Gas pipeline as NGOs cry foul

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Gas extraction has begun this week at the Myanmar-China natural gas pipeline, China National Petroleum Corp. (CNPC) announced on Wednesday, marking a milestone in the project’s trial period after weeks of delays.

The valves at the Kyaukphyu gas station, the pipeline’s starting place, in Rakhine State in western Myanmar were opened on Monday morning, state-owned CNPC said.

But a new report released the same day by a Thailand-based NGO, Shwe Gas Movement, highlights “glaring weaknesses” in Myanmar’s legal framework regarding the extractive industries that, according to a statement, are “resulting in human rights abuses, environmental damage and poor revenue distribution.”

“Natural resources should be used to benefit the country, not to enrich a select few at the expense of the environment and human rights of the affected communities,” said Wong Aung, Coordinator of the Shwe Gas Movement, in a statement on Wednesday.

“Our country has an opportunity to learn from past mistakes, but instead abuses are continuing in connection to the extractive industries. This must be stopped,” Wong Aung added.

The 12 billion cubic meters/year pipeline is operated by CNPC's subsidiary Southeast Asia Pipeline Co. and is scheduled to transmit gas from the offshore Shwe gas fields in the Bay of Bengal to China's southern province of Yunnan. From there, it will connect to a spur line within China.

The Shwe project had been targeted to start from July 1 but operator Daewoo International encountered production problems at the block and was trying to resolve the situation last week, officials at state-owned Myanma Oil and Gas Enterprise told Platts last week.

Daewoo aims to produce 500,000 Mcf/day of gas from the entire project, with 400,000 Mcf/day to be sold to CNPC and the remainder within Myanmar.

MOGE had said last month that Shwe gas will initially be sent to the domestic market until proper commissioning of the Myanmar-China pipeline starts and the connecting pipeline within China has been fully completed. Officials said gas was only expected to reach China around August or September.

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