Thailand rules Yadana pipeline must proceed

The Yadana gas pipeline metering station in Myanmar is nearing completion across the border from Ban I Tong, Tong Pha Phum district, Kanchanaburi province, Thailand. In the background is the pipeline right of way, which extends 63 km to the Daminseik area coast of Myanmar's Mon State, where it connects with the 346-km, 36-in. offshore pipeline to Yadana gas field, about 240 km south of Rangoon in the Gulf of Martaban.

Pipelaying on the Yadana gas pipeline [19,028 bytes]

Thailand's prime minister has ruled that work must continue on the controversial Yadana natural gas pipeline project to Thailand from gas fields off Myanmar.

The ruling comes despite fierce local and international environmental and political opposition to the 260-km Thai portion of the line, which cuts a 6-km path through one of the kingdom's last remaining virgin forests.

Decision

"I have decided that the project must continue," Chuan Leekpai said after his recent helicopter overflight of the pipeline route in the western Thai province of Kanchanaburi.

"The pipeline is almost finished, and nothing should stop it."

Chuan gave his verdict after pondering a report submitted by a panel formed to sort out differences between opponents and supporters in the conflicts over the pipeline's environmental effects.

The 13-person panel, chaired by former Prime Minister Anand Panyarachun, concluded on Feb. 23 that state-owned Petroleum Authority of Thailand (PTT), the gas pipeline project's local sponsor, produced a flawed environmental impact assessment (EIA) and that the EIA process lacked transparency. It suggested that the government act quickly to alleviate social and environmental effects of the scheme.

But the panel, now dissolved, declined recommending it be delayed or the route changed to avoid further effects on the forest. It suggested that Chuan issue a ruling to end the controversy.

"My opinion is that the project cannot be scrapped. It must continue. However, observations raised by the panel are useful. They will be passed on to the agencies concerned for further action," Chuan said.

Chuan's verdict is seen as a foregone conclusion, as he made it clear earlier that attempts by local environmentalists and activists from international nongovernmental organizations to halt the pipeline construction on the section crossing a lush forest in Kanchanaburi had come too late and that pipelaying needed to proceed.

His appointment of the panel, which included opponents as well as proponents of the project, was part of the government's exercise to properly weigh the project's pros and cons.

"I think the prime minister decided to investigate the project just to test the waters, as the conservationists did not have strong reasons to back their claims," said Paisan Labbuangarm, chairman of the Kanchanaburi tourism association.

Project need

Chuan earlier said the $400 million Thai section of pipeline must be completed as part of a contract PTT signed with a group led by France's Total that is developing Yadana gas field in the Gulf of Martaban off Myanmar, formerly Burma.

The 30-year deal calls for an average delivery of 525 MMcfd of Yadana gas, starting this July. Because it is a take-or-pay contract, PTT calculated that it is subject to paying $81.57 million to the Yadana consortium if it fails to take the gas 5 months after the contractual start-up date for gas sales.

The Thai portion of the pipeline-which extends from the Thai-Myanmar border in Tong Pha Phum district, Kanchanaburi, south to the 4,600-MW Ratchaburi power plant-must continue to completion in the interests of the nation, Chuan said.

As expected, opponents of the project were critical of the prime minister's decision.

Chuan must have already decided at the outset that the pipeline project had to be continued, said Penphan Intapantee, coordinator of conservationist groups opposing the project, but she said she could not understand why he had wasted his time setting up the Anand panel.

However, she reaffirmed that groups protesting the project would end a 2-month sit-in at the forest construction site, to honor an earlier promise given to the government.

Construction resumes

Meanwhile, after a 10-day pause last month, PTT's pipelay contractor, the Thai-German combine of Tasco and Mannesmann AG, has resumed pipe- laying at Huay Khayeng forest between pipeline markers 18 and 28, where dozens of opponents camped out to block work over the past 2 months.

Pipelaying in other areas of Thailand continues apace. About 80% of the work is complete, and pipelaying is slightly behind schedule.

Construction on the Myanmar side, including offshore gas production facilities and the offshore and onshore pipelines, is ahead of schedule.

Roger Beach, chairman and chief executive officer of Unocal Corp., a partner in the Yadana gas development and pipeline, said recently that the heavily publicized protests by political groups opposed to the government of Myanmar are not expected to cause major delays in the project.

Opponents of the Yadana gas pipeline in the kingdom have urged Thais to boycott products and services of PTT, Unocal, and Total for their involvement in the gas project.

The Thai activists' call for boycotting PTT, Unocal, and Total products and services is also politically motivated. They are critical of the Yangon (formerly Rangoon) military regime, accusing it of human rights abuses and suppression of the Myanmar opposition groups led by Aung San Suu Kyi.

The call is similar to what has long been deployed by exiled Burmese groups and their supporters in the West, particularly in California, against Unocal, Total, Texaco Inc., and ARCO for their involvement in natural gas projects off Myanmar.

Total has a 31.24% stake in Yadana, Myanmar's biggest offshore gas field, with Unocal holding 28.26%, PTT unit PTT Exploration & Production plc 25.5%, and Mynamar's state-owned Myanma Oil & Gas Enterprise 15%.