An associate company of national oil corporation Petronas has conceded that human rights abuses have been taking place inside an area of Burma it controls. Premier Oil, a British company in which Petronas holds a 25 percent stake, made the statement at its annual meeting on May 15 in London (Guardian, May 16).

Chief executive officer Charles Jamieson, despite previously denying knowledge of "abuses in our pipeline area or of cases of forced labour being used", according to the Guardian report, claimed to have now raised the issue of continuing abuses in Premier-controlled areas with the Burma government. Furthermore, he stated that "It is not just human rights but environmental [abuses], too."

Debbie Stothard of Alternative Asean for Burma notes that the "forced labour", "forced relocation", and "military terrorism" as well as rape, execution and confiscation of property that campaign groups have alleged are a typical practice for "clearing an area to lay down a pipeline".

Campaigners allege that approximately 25,000 people have been forcibly relocated and the region "secured" by over 5,000 troops of the Burmese military in the interest of potentially lucrative infrastructure development projects in Burma, which holds United Nations' "least developed country" status.

Petronas is partnered with Premier Oil in the Yetagun gas field and pipeline project off the coast of southern Burma and west of Bangkok. They form part of a consortium led and operated by Premier in which Petronas holds a 37 percent stake. In October last year a global strategic alliance between the two companies was announced when Petronas bought a 25 percent stake in Premier Oil for US$167 million.

Premier's admission comes belatedly after 12 years of rule by the State Peace and Development Council (SPDC) military junta. In 1999 the International Labour Organisation (ILO) expelled Burma from its meetings as a result of the "widespread and systematic use of forced labour in Myanmar (Burma)".

The 30-year Yetagun gas supply contract signed with Thailand promises a steady stream of income for the country. Thus far, oil and gas companies as well as other multinationals in Burma have come under pressure for effectively financing a government which has acquired an international reputation for its human rights abuses, condemned as recently as April this year by the UN Commission on Human Rights.

Big Oil in trouble

Premier Oil's revelation is the latest in a series of controversial disclosures involving the international oil and gas industry over the last decade. With reserves being located in often troubled and remote parts of the world, human rights and environmental issues have turned up time and again.

Mobil Indonesia was placed in the uncomfortable position of having to house soldiers within its compound and furthermore, to permit the prayer enclosure to be used as a detention area for Acehnese dissidents. It subsequently became their grave.

In 1995 international condemnation was directed at Shell over the death of Ken Saro-Wiwa in Nigeria. Well-known literary figure, Saro-Wiwa, had attracted the enmity of both Shell and Sani Abacha's military regime for bringing both their oppressive activities to international attention. Shell's reputation has still to recover from their failure to prevent his execution.

Unocal, an American oil company, is already facing litigation in US federal courts for its involvement with abuses in Burma. EarthRights International, an environmental and human rights pressure group based in Bangkok and Washington, DC, who are one of the plaintiffs, have also indicated that similar legal action against Premier is a "possibility".

Social responsibilities

As the largest British investor in Burma, the UK is keen for Premier to uphold the reputation of its parent country abroad. According to the Financial Times (May 16), Premier has already commissioned an independent audit to assess whether it is fulfilling its "social responsibilities" in Burma.

"Constructive engagement", a term similar to that used by Shell in Nigeria, will be Premier Oil's policy in Burma according to chief executive Jamieson, "the development of an emerging country's energy resources is one of the prime requisites for longer term economic growth." (With the logic being that greater standards of human rights follows economic growth).

For Shell, it was only the sudden death of dictator Abacha and subsequent democratic elections that improved perceptions of their situation in Nigeria.

Premier Oil is unlikely to enjoy such "fortune" in the near term. An EarthRights report, "Total Denial", published May 22 contains copies of leaked documents which reveal that oil companies had prior knowledge of forced labour taking place before they joined the pipeline projects.

The question now turns to whether Malaysian companies engaged in socially and environmentally destructive activities will face similar scrutiny. So far, notes Stothard, Petronas' activities in Burma have escaped the notice of Western consumer campaigns.

Whether the company is complicit in human rights abuses, if any, by virtue of its association with Premier Oil (or without for that matter) is subjective. Petronas, according to Stothard, has been less transparent about its activities than its Western counterparts and campaigners have not been able to find out much about its engagements in Burma.

"Petronas believes that its long-term business activities and community relations initiatives will uplift the economic and social lives of the people wherever it operates, not the least in Myanmar (Burma)," said their official spokesperson.

"It has been amply demonstrated that respect for human rights will inevitably increase, and unacceptable and entrenched habits get neutralised, whenever a country achieves good economic and social progress."

"Destructive Engagement" another report by EarthRights notes: "Since 1988, the oil and gas sector has provided by far the largest amount of foreign direct investment for the military regime." This has been followed by "militarisation with corresponding human rights and environmental abuses without corresponding benefits for the local population", notes the report.

Premier was contacted by malaysiakini but declined to comment.

Governmental pressure

In April Premier Oil was urged by the UK government to withdraw from its stake in the Yetagun project because of concerns over SPDC's human rights record. The UK's Labour government is attempting to fulfil its earlier commitment to an "ethical foreign policy" which has so far been dogged by scandal as revelations have emerged of arms export subsidies and the underwriting of a controversial dam project in Turkey. Burmese opposition leader Aung San Suu Kyi has also called for Premier's withdrawal until democracy is restored.

When Burma joined Asean in 1997 and concerns were voiced over its human rights record and the technical illegality of the SPDC government, Asean leaders expressed the hope that Burma would "learn by example". However, Malaysia has always been a staunch promoter of Asean's "non-interference" policy, and urging Petronas to withdraw from investments in Burma in protest of the junta would appear to breach this promise.

This does not detract from the fact that Petronas is a state-owned multinational corporation whose activities should be subjected to public accountability. Deputy Prime Minister Abdullah Ahmad Badawi himself has stated, with respect to the perils of globalisation, that "The danger is that sovereign governments that derive their legitimacy from their citizens are superceded by people and corporations that are not accountable to anyone".

The recently formed Malaysian Human Rights Commission (Suhakam) has tentatively accepted complaints submitted from overseas concerning local human rights issues ( malaysiakini , May 29), but it remains to be seen whether they will investigate concerns of human rights abuses taking place within the interests of state-owned companies or their subsidiaries abroad. Both Malaysia's and Petronas' international reputations hang in the balance.