US Envoy Voices Concerns about MOGE

The newly appointed US ambassador to Burma, Derek Mitchell, speaks to Aung San Suu Kyi at her home in Rangoon in March while he served as US special envoy to Myanmar. (PHOTO: Reuters)

The United States has concerns about Myanma Oil and Gas Enterprise (MOGE) with regard to the lack of transparency and the level of corruption associated with it, a top US diplomat told lawmakers on Wednesday.

“The issue of MOGE is one that we are looking very carefully at,” Derek Mitchell told a key US Senate Committee during his ambassadorial confirmation hearing. “We have concerns about this enterprise and its transparency and the corruption that is associated with it through reports that we have … There are particular concerns here with connections to the military and such.”

Mitchell is currently the special US representative and policy coordinator for Burma. He has been nominated by President Obama as the US ambassador to the country.

“We obviously are going to be careful and we should be careful,” he said in response to a question from a senator. “However we engage, that we do so with the highest standards of transparency, that we are contributing to reform inside the country, that we are contributing to the highest values and that we model the type of behavior that we like to see, broadly by US companies and by others. This particular issue when it comes to the general licenses that are being debated and discussed. Obviously it’s on the agenda and being looked at. There are no decisions made on this particular question.

“Clearly we want to see others raising their level to the standards, not just the American companies, so that we are on a level playing field. As we looked at the general license, we understand the balance between competitiveness and the standards that we want to set. So this is an ongoing question,” he said.

“Would you agree that the standards that are applied, should be the same standards that the United States applies in other countries?” asked Senator Jim Webb who chaired the confirmation hearing. “Yes, absolutely,” Mitchell responded.

“There have been public statements saying they are interested in more transparency in the extractive industries, including oil and gas. It’s very encouraging. I think it is our role to encourage that, to continue to educate,” he said, adding that he sees that things are moving in the right direction.

“Aung San Suu Kyi can certainly play a role inside the country in doing that so that everyone has a level playing field. But I would never dismiss what she says from our thinking. I mean, she is obviously a unique figure representing people in the country. And she represents values that we are care about,” he observed.

Senator James Inhofe asked if the US government decided not to allow its oil and gas companies to operate there, would those resources go undeveloped or would the companies from other countries take up that slack. “I think it’s been demonstrated from the past that other countries will likely take up the slack, but there may be some areas where the US is uniquely able to exploit. But clearly there are other countries that are ready to pick up the slack,” Mitchell said.

Earlier in his opening remarks, Webb praised the steps being taken by the Burmese government. “Let’s not forget that this country has had two peaceful national elections within the last year, released hundreds of political prisoners, negotiated ceasefire agreements with 12 ethnic minority groups, reduced censorship of the media, and supported the development of an effective political opposition,” he said.

“This is a country whose political system remains a challenge, but where positive conduct calls for reciprocal gestures. We should never take our concerns about political freedoms or individual rights off the table. We should make these concerns central to our engagement with all countries including with Burma,” Webb said. “But we should also be promoting economic progress to sustain the political reforms that have taken place. It’s time to make our policies internationally consistent with our principles.”

Mitchell told lawmakers that the Obama administration has been quite consistent and direct in public and private about its continuing concerns about the lack of transparency in Burma’s military relationship with North Korea.

“And specifically that the government must adhere to its obligations under relevant UN Security Council resolutions and it’s other international nonproliferation obligations. If confirmed as ambassador, I will continue to make this issue of highest priority in my conversations with the government and be clear that our bilateral relationship can never be fully normalized until we are fully satisfied that any illicit ties to North Korea have ended once and for all,” he said, addressing lawmakers.

“As the Burmese government has taken steps over the past year, so too has the United States in an action-for-action approach,” he added. “Each action we have taken in recent months has had as its purpose, to benefit the Burmese people and strengthen reform and reformers within the system. This engagement should continue and expand. If confirmed, I will do my part in the field, to support a principled approach that effectively marries our values with our broader national interests.”


4 Responses to US Envoy Voices Concerns about MOGE

  1. This should set the standard for all mega projects to prevent the cronies from deprving the country and people of their rightful wealth.

  2. Daw Aung San Suu Kyi mentioned about MOGE with BBC interview ( please watch https://www.youtube.com/watch?feature=player_embedded&v=hsCr5DSMwSo#! At 7:38 minutes) that all foreign investors of extraction companies should work together with MOGE. However, the foreign companies should adhere to IMF code of good practices for fiscal transactions http://www.imf.org/external/np/pp/2007/eng/051507c.pdf . They should encourage MOGE to abide by the good practices too. By doing this, it will promote transparency which is the key for responsible and sustainable investments. What a noble advice she is providing to all parties.

  3. http://www.worldoil.com/Myanmar_inks_oil_exploration_deals_with_international_operators.html

    World Oil News Center

    Myanmar inks oil exploration deals with international operators

    YANGON — Myanmar has signed a raft of oil exploration deals with foreign companies as the reformist government seeks overseas investment to spur economic development.

    State-owned Myanma Oil and Gas Enterprise has inked nine agreements since early March to allow firms from Asia and Europe to explore for oil and natural gas, the Myanmar Ahlin newspaper reported.

    “It was the first time in the history of Myanma Oil and Gas Enterprise to sign nine agreements within such a short period,” the report said, without giving financial details.

    “More significantly, Myanmar national companies were involved in all nine agreements as partners,” it added.

    The firms are EPI Holdings of Hong Kong, Geopetro International Holding of Switzerland, Petronas of Malaysia, Jubilant Energy of India, PTTEP of Thailand, Istech Energy of Indonesia and CIS Nobel Oil of Russia.

    The report said the energy ministry had decided in principle to grant licenses to foreign companies to invest in Myanmar only if they cooperate with domestically owned firms.

    It said 10 foreign companies were exploring for oil at 24 offshore energy fields, while eight overseas firms–as well as seven joint ventures with local companies–were exploring 20 inland fields.

    “Many companies are contacting Myanma Oil and Gas Enterprise to explore for oil and natural gas by investing at other inland and offshore fields,” it said.

    Myanmar’s reform-minded President Thein Sein said in a televised speech on Tuesday that economic development would be at the center of his next phase of reforms, which aim to boost the role of the private sector.

    06/20/2012

  4. A GOOD ONE BY Derek Mitchell.

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