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January 27, 2022

Woodside joins Myanmar exit despite hit to profits

The news comes as companies are beating a hasty retreat from the increasingly volatile nation.

By Scarlett Evans

Australian gas major Woodside Petroleum has joined the likes of Chevron and TotalEnergies and announced its retreat from operations in Myanmar, as a result of the nation’s political turmoil and fears over the worsening humanitarian crisis. 

Woodside has been conducting exploration and drilling campaigns in the South East Asian nation since 2013, though it announced its decision to review all existing business operations following the political coup in February 2021 and the subsequent “deteriorating human rights situation”. 

The gas major pulled out of a number of offshore blocks last year, and is now in the process of withdrawing from a series of exploration assets, as well as the A-6 production sharing contract held with the Myanma Oil and Gas Enterprise.  

“Woodside has been a responsible foreign investor in Myanmar since 2013, with our conduct guided by the UN Guiding Principles on Business and Human Rights and other relevant international standards,” said Woodside CEO Meg O’Neill in a statement. “Given the ongoing situation in Myanmar, we can no longer contemplate Woodside’s participation in the development of the A-6 gas resources, nor other future activities in-country.”  

The group noted the withdrawal would signify a $138m hit to its 2021 net profit, in addition to a $71m exploration and evaluation expense for Block AD-7. 

The decision comes a week after Chevron and TotalEnergies announced their withdrawal from the Yadana gas field over the worsening humanitarian crisis in the country, with human rights groups ramping up pressure on nations to cut financial ties with the junta.  

On Wednesday this week, the US issued a business advisory for Myanmar, warning companies of the increased risk working in the nation under military rule.  

“The coup and subsequent abuses committed by the military have fundamentally changed the direction of the economic and business environment in Burma,” the advisory said. “The military regime’s government is undermining democratic processes and the rule of law, facilitating corruption, and committing serious human rights abuses; these actions exacerbate risks to foreign businesses and individuals operating in Burma or providing financial services to Burmese businesses.” 

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