In July 1992, Total signed a production-sharing contract to develop and operate the Yadana gas field in Myanmar. The Group's presence in the country has created controversy and raised questions, addressed here by Jean-François Lassalle, Total's E&P Vice President, Public Affairs.

What does Total do in Myanmar?

JFL - Total is operator of the Yadana gas field in the Andaman Sea. This major energy resource contains 150 billion cubic meters of natural gas and has an expected field life of 30 years. To give you an idea of its size, output from the field, which averaged 19.3 millions cubic meters per day in 2006, is enough to generate about 2500 MW of electrical power. The gas is piped from the field to the border of Thailand, which uses 90% of the gas produced to fire power plants in the Bangkok region.

The Myanmar regime has been strongly criticized and activist campaigns have persuaded a number of Western companies to leave the country. Why has Total decided to stay?

JFL - We deeply regret how the situation in Myanmar is developing, despite signs in recent years that political tensions were easing. These signs raised hopes for the beginning of serious dialogue that might have led to national reconciliation. Total is therefore very concerned about the events in May 2003 that culminated in the arrest of Aung San Suu Kyi. Should we withdraw, even though no decision by a European or international body requires us to do so? What's more, our operations there comply with our own ethical guidelines and Code of Conduct.

Various Western governments and NGOs are applying strong pressure on Myanmar and in July 2003 the United States introduced a strict trade embargo on the country. At the same time, international aid-with the exception of humanitarian assistance- has slowed to a trickle and boycotts have driven the country further into poverty. We firmly believe that a country's economic development is intrinsically linked to its human rights record.

Our initiatives have made a real contribution to Myanmar's economic and social development. We are developing the country's natural gas resources using efficient methods consistent with the principles of sustainable development. We are creating skilled jobs, devoting considerable resources to training managers, employees and local subcontractors, and applying our international standards with regards to employment, workplace safety and environmental protection. In addition, we have implemented a socio-economic program to ensure that the Yadana project significantly improves living conditions for villagers living near the pipeline.

Could you describe the Socio-Economic Program in more detail?

JFL - Launched in early 1995, more than six months before work on the pipeline began, the program focuses on four key areas: health care, education, economic development and infrastructure construction. Its components are defined in close cooperation with inhabitants of the 25 villages covered by the program, over 50,000 people in all. With our co-investors, we have already allocated over US$ 14.1 million, which has been used to build or renovate a hospital, health centers, schools, roads, wells and water supply systems, and bridges. The program is being carried out by a team comprised of communication officers, physicians, veterinarians and agriculturalists-all of them Myanmar nationals.

Health conditions in the region are now satisfactory, showing significant declines in the number of cases of malaria and in infant mortality. All children can now attend school in good conditions and enrollment has doubled. Technical and financial assistance has spurred the development of animal husbandry (pigs, chickens and cows) as well as seasonal and perennial crops, such as rice, vegetables, cashew nuts, oil palms and rubber trees. Fishing and small businesses have also been encouraged.

The program also includes initiatives outside the pipeline region, such as support for orphanages in the Yangon region and a nation-wide blindness prevention program deployed by Helen Keller International.

In addition, in early 2005, Total joined a public health initiative in Myanmar designed to support and treat people living with HIV/AIDS in the Mandalay region.

Outside experts have verified the quality of the Socio-Economic Program on several occasions. US-based Collaborative for Development Action (CDA), an independent organization that works extensively with international development agencies, conducted four onsite missions in 2002, 2003 and 2005. Its report found that, in addition to the material improvement in inhabitants' lives, Total's presence primarily serves to ensure peace and tranquility, thereby benefiting all ethnic groups living in the region.

While Total's initiatives have made material improvements in the lives of inhabitants, both in the pipeline region and elsewhere in Myanmar, what about human rights and the issue of forced labor?

JFL - Protecting villagers and prohibiting the use of forced labor, which is still a real problem in Myanmar, has been Total's constant concern since 1995, when we first entered the region where the pipeline was to be laid.

The Army had already been operating in the area for several years to combat sporadic guerilla incursions and had used forced labor. To support its Socio-Economic-Program, Total in 1995 established communication channels with inhabitants for the purpose of gaining access to information about the situation in the field. These channels included elected Village Communication Committees, women paid by the program to maintain continuous contact with inhabitants, and program physicians living in the villages. Through these channels, when certain incidents did occur, Total was informed and able to intercede with the authorities to put halt to them.

Our principle of political neutrality does not, however, mean that we are indifferent, especially on issues related to human rights, environmental protection and development. Wherever we operate, we strive to be constructive and to maintain a dialogue with civil society, NGOs and government officials to support economic and social development. The villagers recognize that we have been vigilant and effective, telling the CDA that: "Total has allowed us to sleep soundly."

On November 29, 2005, Total reached an agreement with the Sherpa Association and eight Burmese plaintiffs who had started legal proceedings at the Nanterre District Court for “arbitrary sequestration” during the construction of the Yadana pipeline in Myanmar in 1995. Couldn’t this be construed as an admission of responsibility? Why didn’t you wait for the court to make its ruling?

JFL - Total has never used forced labour, either directly or indirectly through contractors. We always insured that forced labour was not used in the area in which we operated.

When we learned that incidents of forced labour had occurred in the pipeline corridor despite our vigilance, we paid compensation immediately, on humanitarian grounds.

We could have waited for the trial, which we would have very probably won, but how long would it have taken?
Don’t forget either that the claims date back more than ten years. We therefore felt it would be better to negotiate a settlement and introduce new community-based initiatives to supplement those already deployed under our Socio-Economic Program.

This does not constitute an admission of responsibility. We are merely acting as a responsible corporate citizen in a challenging environment and continuing to implement initiatives that are already underway.

So, do you feel that despite the criticism and the legal proceedings, Total should stay?

JFL - Because the Yadana project is important for Myanmar, it has become a favorite target of activists critical of the government. The allegations against Total are part of their political struggle and have naturally received a certain amount of media coverage.

Our determined commitment to remain in Myanmar for the project's 30-year duration is preferable to withdrawing. Through the Yadana project, we have made a meaningful contribution to the country's social and economic development, while promoting respect for human rights. Without seeking to interfere in the country's political situation and while respecting its traditions and culture, we monitor our initiatives in the field closely to ensure that they benefit the country's inhabitants. The country needs other projects of this kind to help it overcome its many problems.