Report 221 Views

Specific Instance Request to the National Contact Points of Canada and the United Kingdom under the Specific Instance Procedure of the OECD Guidelines for Multinational Enterprises

September 14th, 2023  •  Author:   Earthrights International  •  4 minute read
Featured image

Executive Summary

A Myanmar civil society and EarthRights International submit this specific instance (the “Complaint”) to the National Contact Points of Canada and the United Kingdom concerning the activities of Canadian oil company MTI Energy Inc (MTI Energy) in Myanmar (Burma), in accordance with the 2011 and 2023 versions of the OECD Guidelines for Multinational Enterprises. This Complaint relates to MTI Energy’s planned investment in the Yadana fossil gas project in Myanmar through its agreement to purchase Chevron Corporation’s stake in its joint venture with the Government of Myanmar.

MTI Energy is a multi-national enterprise registered in Canada. Its purchase will be through a subsidiary, Et Martem Holdings, registered in Bermuda, a British Overseas Territory. As such, the NCPs of Canada and the United Kingdom have jurisdiction over this Complaint.

In February 2021, the Myanmar military launched a military coup, preventing a democratically elected government from taking office and responding to protests with campaign of violence. In the last two years, the military junta has committed well-documented crimes against humanity, war crimes and other human rights abuses, but has been unable to seize control of Myanmar, dragging the country into humanitarian crisis and civil war. The military regime and its State Administration Council (SAC) remain widely unrecognized as the Government of Myanmar. The junta lacks both legitimacy and territorial control over large parts of the country. Ethnic revolutionary organizations (EROs) control substantial parts of the country and many are cooperating with Myanmar’s National Unity Government (NUG), which was set up by elected lawmakers shortly after the coup began and has a rival claim to be recognized as a government.

MTI Energy has agreed to acquire Chevron’s 41.1% share in the Yadana project, a joint venture with the Government of Myanmar, even though the Myanmar military junta is misappropriating revenues which are due to the Government of Myanmar and which the junta can use to fund its atrocities. These revenues flow through a government agency, the Myanma Oil and Gas Enterprise (MOGE). Because the joint venturers in the project have credited the military’s instructions regarding payment to MOGE, revenues from the Yadana project are being seized by the junta. In 2021, MOGE’s monthly revenues from Yadana from gas sales alone2 reached over USD 60 million per month and were forecast to provide over 40% of Myanmar’s gas revenues in 2023-24. The junta can use these revenues, one of its few sources of foreign currency, to purchase weapons and commit egregious human rights abuses, maintain patronage networks in Myanmar.

MTI Energy has breached OECD Guidelines in five main aspects:

  1. MTI Energy has engaged in improper involvement in political activities in breach of the 2011 and 2023 Guidelines.
  2. MTI has engaged in corrupt acts and breach of Myanmar law in breach of the 2011 and 2023 Guidelines. These breaches will become more serious if it completes its acquisition.
  3. If MTI Energy completes its acquisition, it will be contributing to human rights abuses in breach of the 2023 Guidelines.
  4. Even if MTI Energy does not complete its acquisition, likely contributing to and at the least directly linked to human rights impacts by its business relationships under the 2011 Guidelines. MTI Energy’s relationship to these impacts is not static – the longer it maintains its relationships, fails to carry out due diligence or mitigate its acts, the more likely that it should already be seen as contributing to human rights impacts.
  5. MTI Energy has breached the procedures and practices set out in the 2011 Guidelines that Multinational Enterprises (MNEs) should follow prior to making investment, particularly in a country affected by widespread armed conflict and in a sector that funds the perpetrator of well-documented human rights violations. MTI has either failed to carry out adequate enhanced due diligence or ignored the findings, has failed to carry out meaningful stakeholder engagement and has failed to meet requirements on transparency regarding decision-making to invest.

Download full complaint.