5

China–Myanmar Pipelines: Business Operated as Usual with Weak Opposition

The China–Myanmar oil and gas pipeline project (China–Myanmar pipelines) that transports crude oil and natural gas from the Bay of Bengal to China’s south-western region is another China-backed mega project in Myanmar. It is regarded as China’s most strategic project in the country as it serves to enhance China’s energy security. The project would also link to other Belt and Road Initiative (BRI) projects in Myanmar’s port city Kyaukphyu, including the deep sea port, special economic zone (SEZ) and prospective high-speed railway. The contracts for the pipeline project were signed in June 2010. Construction commenced right after the signing of the agreements. The gas pipeline went into operation in 2013. Meanwhile, the trial operation of the oil pipeline was launched in January 2015. By and large, the project implementation went well. In 2015, the media reported that Naypyidaw requested to renegotiate the contract terms with Beijing (Aung Shin 2015), but to no avail (Chen 2016). In April 2017, crude oil began to flow through the pipeline after China’s oil refinery construction was completed. Despite a two-year delay in the oil pipeline operation, the project was largely implemented according to the agreement. The project outcome contrasted with the Myitsone dam suspension and the Letpadaung copper mine’s contract revision. Why did Beijing refuse to redistribute gains with Naypyidaw in the strategic oil pipeline project?

Similar to the Myitsone dam and the Letpadaung copper mine, the China–Myanmar oil and gas pipelines encountered social opposition in the early phase of Myanmar’s political transition. When the pipeline project was still under planning in the mid-2000s, a transnational movement was formed to overturn the project. In the early stage of the anti-pipeline movement, Shew Gas Movement (SGM) and Arakan Oil Watch (AOW), both Chiangmai-based organisations founded by Rakhine activists, were the leading organisations in the network.¹ Prior to the regime change in Myanmar in 2011, domestic actors could hardly influence the military government. The transnational movement emerged to strengthen local resistance and pursue policy changes from the outside through a boomerang model of activism (see Keck and Sikkink 1998; Mihr and Schmitz 2007). Several global action days against the pipeline project, with the support from a hundred overseas civil society organisations (CSOs), were held. International allies presumably could narrow the difference in political resources between the challengers and powerholders. However, the anti-pipeline movement did not change the status quo of the agreement.

The previous empirical chapters on the dam and copper mine disputes highlighted that the level of domestic audience costs is vital in triggering renegotiations of a signed bilateral agreement. It was generally perceived that the controversial pipeline project could generate a high level of audience costs. Although some studies posit that the anti-pipeline campaign attests to a linkage between transnational activism and local resistance (Yeophantong 2015; Simpson 2014, Ch. 6), this research finds otherwise. The transnational movement succeeded in galvanising moral pressure at the international level, but had a limited impact on domestic mobilisation. In the domestic anti-pipeline campaigns, the project that cut across Myanmar was expected to provoke a vigorous response in the country. Counterintuitively, only sporadic protests by a small group of farmers were reported throughout the 2010s. On the contrary, a strong movement that demanded 24-hour electricity access emerged in Rakhine State in 2012. The movement did not aim at derailing the project, whereas it called on Naypyidaw to share benefits with the ethnic state. Even though the Thein Sein administration and the National League for Democracy (NLD)-led administration attempted to renegotiate payoffs in the BRI project, Beijing rejected the requests. To Beijing, Naypyidaw was not constrained by domestic pressure in project implementation. That said, the anti-pipeline campaign could hardly generate a high level of domestic audience costs to activate the two-level game.

This chapter explains the maintenance of the project’s status quo despite a transnational anti-pipeline movement and Naypyidaw’s request for gain redistributions. The second section presents the background information on the pipeline project. It shows the strategic value of the project to China in the wake of the ‘Malacca Dilemma’. The third section outlines the key actors in the anti-pipeline transnational movement and their activities. The fourth and fifth sections detail domestic opposition to the pipeline project during and after the pipeline construction respectively. Then, the chapter measures the level of audience costs generated by the anti-pipeline movement. The seventh section adopts the audience cost mechanism to examine the interaction among the domestic audience, Naypyidaw and Beijing in the anti-pipeline campaign. It crystallises that Naypyidaw’s diplomatic intention alone could not shift the policy outcome. Before the concluding marks, the chapter provides alternative explanations for the maintenance of the project’s status quo.

About the dual pipeline project

The China–Myanmar oil and gas pipeline project is part of China’s energy security blueprint. Over 75 per cent of China’s oil imports have to pass through the Malacca Strait which allegedly falls within the US navy’s sphere of influence.² However, the alternative sea-lane route was more unstable and costlier (Andrews-Speed and Dannreuther 2011; Zhao 2011b). Currently, Beijing is employing three strategies to mitigate the ‘Malacca Dilemma’.³ First, it launches a ‘charm offensive’ to promote interdependence with the Association of Southeast Asian Nations (ASEAN) countries (see Andrews-Speed and Dannreuther 2011, 141). Any disruption to the oil transportation will also lead to economic ramifications for China’s partners (see Keohane and Nye 2012). Second, it builds a blue-water navy to protect sea-lane communications from external threats. Third, it develops alternative energy transportation routes to bypass the Malacca Strait. It reportedly uses ports in Pakistan, Sri Lanka, Bangladesh and Myanmar to increase its economic, and possibly military, presence in the region. The plan is commonly dubbed as ‘string of pearls’ by the West (Kardon and Leutert 2022). Pipelines,⁴ including the China–Myanmar pipelines, could transmit crude oil to China’s western regions. Beyond security considerations, the China–Myanmar pipelines are expected to achieve several geoeconomic and geopolitical goals. On the economic front, the project shortens the oil transportation from the Middle East to China’s south-western region by roughly 3,000 km (Li and Song 2018). The transportation cost for crude oil is thus decreased. Moreover, access to energy can promote economic development in China’s landlocked region and ease China’s regional income disparity (Steinberg and Fan 2012) (see Figure 5.1). On the political front, energy experts anticipate that the pipeline project also serves as a strategic tool to extend China’s influence over its neighbour (see Dannreuther 2011; see also Zhao 2011b).

The China–Myanmar oil pipeline was advocated by three Chinese scholars, Li Chengyang, Qu Jianwen and Wu Lei of the School of International Relations, Yunnan University, in 2004 (Kong 2010, 58). China’s National Development and Reform Commission of the State Council approved the initiative two years later (Perlez 2006). In 2008, the oil pipeline plan was upgraded to a dual oil and gas pipeline project after the China National Petroleum Corporation (CNPC) reached an agreement with a Daewoo International-led consortium⁵ to buy natural gas from two offshore blocks, Shwe and Shwe Phyu fields in Block A-1 and Mya field in Block A-3, for 30 years (China National Petroleum Corporation 2015). Owing to the name of the gas fields, the pipelines are commonly known as Shwe Pipelines.

Figure 5.1: Sea-lane transportation and the new resource corridor through Myanmar.

Source: Congressional Research Service (2018).

Table 5.1: Basic information about the China–Myanmar oil and gas pipeline project.

	Oil pipeline	Gas pipeline
Name of the joint venture	Southeast Asia Oil Pipeline Co. (SEAOP)	Southeast Asia Gas Pipeline Co. (SEAGP)
Contract signed	June 2010	June 2010
Ownership structure	CNPC (50.9%) and Myanmar Oil and Gas Enterprise (MOGE) (49.1%)	CNPC (50.9%); Daewoo (25%); ONGC Videsh Ltd. (8.3%); MOGE (7.4%); GAIL India (4.2%) and Korean Gas Co. (4.2%)
Route and length	Myanmar’s Rakhine State – China’s Chongqing 771 km (total length: 2,401 km)	Myanmar’s Rakhine State – China’s Guangxi Zhuang Autonomous Region 793 km (total length: 2,520 km)
Construction cost (estimate)	USD 1.5 billion	USD 1.04 billion
Capacity	22 million tonnes of oil per annum	12 billion cubic metres of natural gas per annum (20% of gas for Myanmar’s domestic consumption)
Concession period	30 years	30 years
Status	construction completed in May 2014; trial operation in January 2015; transmission began in April 2017	construction completed in July 2013; full operation in October 2013

Source: Author’s summary.

The cooperative agreements were constantly signed with the presence of the top leaders of both countries.⁶ The shareholder agreements of the oil pipeline and the gas pipeline were concluded in early June 2010 during Chinese Premier Wen Jiabao’s visit to Myanmar (China National Petroleum Corporation 2015). CNPC subsequently announced the establishment of the Southeast Asia Oil Pipeline Corporation (SEAOP) and the Southeast Asia Gas Pipeline Corporation (SEAGP). Both joint ventures were registered in Hong Kong. For SEAOP, CNPC and state-owned Myanmar Oil and Gas Enterprise (MOGE) hold 50.9 per cent and 49.1 per cent stakes respectively (see Figure 5.2). For SEAGP, CNPC controls a 50.9 per cent stake, while Daewoo International (South Korea), ONGC Videsh Ltd. (India), MOGE, GAIL India, and Korean Gas Co. hold 25 per cent, 8.3 per cent, 7.4 per cent, 4.2 per cent and 4.2 per cent respectively (Myanmar–China Pipeline Watch Committee 2016) (see Figure 5.3). This study notes that SEAOP and SEAGP comprise companies of different nationalities. Given that CNPC controls both SEAOP and SEAGP, this chapter uses CNPC to represent the two consortiums.

Figure 5.2: Share distribution of the oil pipeline project.

Source: Author’s depiction.

Figure 5.3: Share distribution of the gas pipeline project.

Source: Author’s depiction.

According to the shareholder agreements, CNPC takes the helm of the project, from design to construction, operation and maintenance of the oil and gas pipelines (China National Petroleum Corporation 2010). The construction of the oil and gas pipelines began in June and September 2010 respectively. The transboundary oil pipeline is 2,401 km long, of which 771 km is laid in Myanmar. It could transmit 22 million tonnes of oil per annum to China. Meanwhile, the gas pipeline has a length of 2,520 km, of which 793 km is located in Myanmar. It is expected to deliver 12 billion cubic metres of gas per annum to China (China National Petroleum Corporation 2015). By and large, the pipelines run parallel to each other. The natural gas is transported through underwater pipelines from the offshore gas fields in the Bay of Bengal to an onshore gas terminal in the port city Kyaukphyu, Rakhine State. It then joins the oil pipeline that starts from Maday Island, Rakhine State. The two pipelines continue going north-east and passing through Magway Division, Mandalay Division and Shan State. They enter China’s border through Ruili, Yunnan province. After crossing Yunnan province, both pipelines continue going inland. In Guizhou Province, the routes of the two pipelines diverge. The oil pipeline ends in Chongqing, and the gas pipeline stops in Guigang, Guangxi Zhuang Autonomous Region (Pu 2013) (see Figure 5.4). The construction cost of the oil and gas pipelines was reported at USD 1.5 billion and USD 1.04 billion respectively.

Figure 5.4: The route of China–Myanmar oil and gas pipelines.

Source: Author’s illustration.

In July 2013, the construction of the gas pipeline was completed. The full operation started in October 2013 (Szep 2013; China National Petroleum Corporation 2013). For the oil pipeline, Myanmar’s section was completed in May 2014. The trial operation was launched in January 2015 (Xinhua 2015). The oil transmission only began after the new oil transport agreement was signed in April 2017 during President Htin Kyaw’s visit to China (Myanmar News Agency 2017). Despite disputes over the transmission fee and crude oil tariff, it belied the fact that the postponement of the oil refinery construction in Yunnan province also contributed to the oil pipeline operation delay (see Chen 2016).⁷ Even though Naypyidaw attempted to renegotiate the gains in the project, no new agreement was reached.

Controversy over the pipeline project

Large-scale mega developmental projects in ethnic areas trigger opposition for multiple reasons, including human rights violations, environmental degradation, a lack of revenue transparency and an impediment to economic sanctions (see Simpson 2014; Yeophantong 2015). The amount of land confiscated or temporarily confiscated for the construction of the pipelines in Myanmar was not made public. According to the Myanmar–China Pipeline Watch Committee’s (MCPWC) estimation, 6,500 acres of land was confiscated for pipeline projects across the country (Aung Shin 2013; interview: N10). Roughly 1,800 acres of agricultural land was destroyed in Rakhine State alone (Thiri Shwesin Aung, Fischer, and Buchanan 2020). MCPWC, along with other pipeline watchdogs, like SGM and Ta’ang Students Youth Organization (TSYO), reported that farmers were coerced into giving up their land to make way for the project. Affected farmers were not well informed about whether they would lose their land permanently or temporarily during the project construction. They also complained about unfair compensation and money extortion from the authorities (Myanmar–China Pipeline Watch Committee 2016; Shwe Gas Movement 2011; Ta’ang Students and Youth Organization 2012).

Livelihoods of farmers and fisherfolk deteriorated due to environmental degradation – improper waste management in the project polluted the area, which caused huge problems for farmland irrigation. Moreover, in the rainy season, construction waste washed onto villagers’ farmland (Ta’ang Students and Youth Organization 2012; Myanmar–China Pipeline Watch Committee 2016). Rapid deforestation endangered the biodiversity in the country. Communities that relied on natural resources in the forest were worse off. Despite reforestation efforts, including large-scale plantations, they could not restore the ecosystem in the affected regions (Thiri Shwesin Aung, Fischer, and Buchanan 2020). The fishing community in Rakhine State was restricted approaching designated areas so as not to obstruct the tankers’ operations (Gerin 2018). They also pointed out that the fish yield had decreased significantly due to the construction of the oil refinery on Maday Island and oil leakage damaging the coastal ecosystem (Shwe Gas Movement 2011).

Arguably, employment opportunities and corporate social responsibility (CSR) programs along the pipelines could gain local people’s support for the project. At the peak of project construction, 6,000 people were employed in Myanmar (Sun 2019). Rakhine villagers recalled that they could benefit from short-term employment, but their daily wage was only MMK 3,000–4,000 (USD 3–4)⁸ (interviews: V15, V16). Some others complained that they did not receive overtime payment for working during the Myanmar New Year holidays (interview: N43). After completing the pipeline construction, only 800 workers were hired. CSR was a social engagement strategy to win local people’s support for the pipeline project. As of 2019, the consortiums have committed USD 27 million to CSR programs in areas of infrastructure, healthcare, education and disaster relief (Sun 2020b). These efforts were, however, overshadowed by business misconduct on the ground. For example, inappropriate solid waste disposed by the company near a pier used by the locals caused serious hygiene and safety problems on Maday Island.⁹ The company even discharged human waste on villagers’ farmland in Kyaukphyu Township (Shwe Gas Movement 2011; interview: P05).

Furthermore, the military government neither disclosed the revenue from the pipeline project¹⁰ nor revealed the budget allocation for public services. A lack of revenue transparency prompted activists to suspect that resource revenue would make the military junta richer and enhance the military capability, which made people in the ethnic states more vulnerable (Shwe Gas Movement 2009). Critics also blamed the mega project for prolonging Myanmar’s dictatorship by undermining Western sanctions. Additionally, to guarantee security for the project, more troops were deployed along the pipelines in the ethnic states. CSOs attributed human rights violations, including forced labour, to the rise of militarisation (Ta’ang Students and Youth Organization 2012; Shwe Gas Movement 2011).

Transnational anti-pipeline campaign and the two-level game

Transnational activism and political opportunities in the target state are inversely correlated (Simpson 2014, 2013; Keck and Sikkink 1998). It is an outcome of a combination of a closed domestic political structure and an open international political structure (Keck and Sikkink 1998; see also Sikkink 2005).¹¹ Linkage among local opposition and external actors is the prerequisite of any transnational movement. Transnational movements in support of the domestic struggle in Myanmar were active amid the military rule in the country. They were influential in offering moral, political and economic pressure on the military junta. Even though external assistance can narrow the power imbalance between powerholders and local opponents, it can never substitute the domestic struggle. Local mobilisation and public opinion are more critical sources of political pressure that can promote domestic change (Knopf 1998). In fact, the scale and impact of transnational activism for Myanmar have declined since 2011. This section examines whether the transnational anti-pipeline movement could set off renegotiations in the international agreements.

The transnational anti-pipeline campaign was part of the broader justice and human rights movement (Simpson 2014, 2013). After waves of political crackdown in the late 1980s and early 1990s, many activists fled Myanmar. Some of them sustained their political activism abroad. The robust development of the exiled community, or ‘activist diaspora’ depicted by Adam Simpson (2013), could be attributed to the technical and financial support from overseas human rights organisations (Tonkin 2014). Against this background, SGM and AOW, both mainly comprising Rakhine activists in exile, were the backbone of the transnational anti-pipeline movement. The transnational movement against the China–Myanmar pipelines was inspired by a similar transnational movement led by Earth Rights International (ERI) that opposed the Yadana and Yetagun pipelines (Yadana project) in the 1990s. The Yadana project transports natural gas from Myanmar’s offshore fields to Thailand.¹² Backed then, ERI and local activists documented gross human rights violations, including forced labour, forced eviction, extrajudicial killing, rape and torture, triggered by militarisation around the project area (Giannini et al. 2003).¹³ Cross-border groups began to resist the China–Myanmar pipelines as they anticipated the project’s environmental and social impacts could mirror those of the Yadana project.¹⁴ Starting from 2006, activists from SGM and AOW, accompanied by local activists, visited Maday Island and Kyaukphyu, the starting point of the oil pipeline and the gas pipeline respectively, to investigate potential risks of the project.

Transnational movements aim to mobilise moral, political and material pressure to narrow the power imbalance between the powerholder and challengers in the target state. In the anti-pipeline transnational movement, moral leverage did not seem to achieve much impact on the powerholders under military rule. The investigative reports by SGM, AOW, ERI, TSYO and other organisations communicated distressed victims’ grievances to the international community. From 2006 to 2013, at least 10 reports on the pipeline project were issued.¹⁵ Before Myanmar’s political transition, activists distributed the reports to local people during their covert visits to the pipeline-affected community (interview: N45). However, the circulation of reports inside the country was minimal.¹⁶ Around the same period, from 2005 to 2012, SGM held seven global action days that opposed the pipeline project. On 1 March 2012, the seventh global action day, over 130 organisations from more than 20 countries, including Thailand, India, Bangladesh, Japan and the United Kingdom, took action to demand President Thein Sein shelve the controversial project (Shwe Gas Movement 2012b). The transitional government was supposed to quest for legitimacy. The Thein Sein administration did not consider foreign criticism a legitimate challenge to its reforms. Also, moral pressure from overseas NGOs did not seem to yield any impacts on CNPC, which shunned human rights criticism. Furthermore, the anti-pipeline transnational movement did not appear to strengthen the political leverage of the domestic movements in Myanmar. Clandestine communication and cooperation between exiled activists and local informants bore high political risks in a repressive political environment. For example, 11 people associated with SGM and AOW were sentenced to six years’ imprisonment for contacting unlawful organisations and crossing borders illegally in 2009 (Simpson 2014). Domestic resistance to the pipelines under the military regime was relatively weak. Consequentially, little political leverage could be obtained by the anti-pipeline movement. In the post-military era, contacts between overseas and local activists remained infrequent. Transnational groups did not prioritise local organisations in their work. Additionally, the organisers did not attempt to exert material pressure on Naypyidaw or Beijing to diminish their prospective gains in the project. On the one hand, the US-led economic sanctions on Myanmar were already in place. On the other hand, Beijing and CNPC were too powerful economically and politically. Imposing economic punishment on Naypyidaw and the Chinese investor did not seem to be a viable strategy.

International human rights campaigns for Myanmar yielded some positive outcomes. For example, the transnational campaign against the Yadana project effectively held the investors accountable by exercising material leverage in the home countries (Simpson 2014). Transnational organisations also fostered a human rights movement by organising training to develop community leaders’ campaign skills. This was important to generate political leverage to push for social and political change (interview: N46). However, the transnational movement against the China–Myanmar pipelines that focused on the ‘mobilisation of shame’ (Keck and Sikkink 1998) had little influence on Naypyidaw and Beijing. A decrease in authoritarianism in Myanmar encouraged local people to stand up for their rights. Local activism revealed the discrepancies between international actors’ campaign objectives and the domestic audience’s concerns over the pipelines. The transnational movement gradually faded out when impacted communities could speak for themselves.

Table 5.2: Chronology of the China–Myanmar pipelines controversy.

Signing of the agreement
Jun 2010	The signing of the pipeline agreements.
Jun 2010	Commencement of the oil pipeline construction.
Sep 2010	Commencement of the gas pipeline construction.
Anti-pipeline campaign
27 Sep 2011	Rakhine Nationalities Development Party lawmaker raised a question on resource-sharing in the Hluttaw (legislature).
19 Nov 2011	The establishment of the Action Committee for 24-Hour Electricity in Rakhine State.
Jan 2011 – Apr 2011	The launch of a T-shirt campaign in Rakhine State.
9 Jan 2012	Naypyidaw issued an energy plan for Rakhine State.
Mar 2012	CNPC made donation for power line construction in Rakhine State.
18 Apr 2013	A mass protest on Maday Island, Rakhine State.
19–20 Apr 2013	The arrest of community leaders on Maday Island.
10 May 2013	CNPC announced the CSR programs along the pipelines.
July 2013	The construction of the gas pipeline completed.
Resource-sharing campaign
Aug 2013	The launch of the signature campaign for electricity supply in Rakhine State.
30 Sep 2013	A 3,000-strong protest in Rambree, Rakhine State was organised.
Completion of the construction of the pipelines
29 Jul 2013	The opening ceremony of the gas pipeline.
Oct 2013	The full operation of the gas pipeline project.
May 2014	The completion of the oil pipeline construction.
2015	Naypyidaw demanded renegotiation of tax and other charges in the oil pipeline.
Jan 2015	The trial operation of the oil pipeline.
April 2017	The oil pipeline agreement was finalised and operation began.

Source: Author’s summary.

Campaign amid the pipeline construction period (September 2011 – July 2013)

Under the Thein Sein administration, the political space in Myanmar was widening. A combination of structural strain resulting from the pipelines and an increase in political opportunities should have facilitated an anti-pipeline movement to grow (see Tilly 1978; Tarrow 2011). Nonetheless, social resistance to the project was feeble throughout the pipeline construction period. After political control was relaxed, exiled dissidents were welcomed back to the country (Ba Kaung 2011a). The selection of office locations signified that the cross-border organisations prioritised advocacy over organising. For example, SGM was headquartered in Yangon when it returned to the country in 2012. Likewise, AOW set up its office in Sittwe, the capital city in Rakhine State, in 2013. Although local activists appreciated the technical assistance and information shared by CSOs, they mostly counted on themselves in community organising (interviews: V15, V17). In Rakhine State, community members did not aim to overturn the project but demanded more benefits. Local protests that did not resonate with the state or national population only produced a low level of audience costs.

Rakhine’s natural resource-sharing campaign

The nature of protestors’ demands could explain the maintenance of the status quo of the project in the pipeline project. The leading opposition party in Rakhine State, Rakhine Nationalities Development Party (RNDP) (later restructured as the Arakan National Party, ANP),¹⁷ did not aim to disrupt the BRI project. It recognised local people’s grievances, for instance, job opportunities were filled by Chinese workers and villagers’ farmland was contaminated by construction waste (interviews: P05, P25, P26). However, the ethnic party’s primary concern was the distribution of gains between Naypyidaw and Rakhine State in the pipeline project. To them, Naypyidaw unjustly extracted natural resources for Burman’s development at the Rakhine people’s expense. RNDP politicians complained that their ethnic state was one of the poorest regions in the country. They welcomed foreign investments, including Chinese investments, that could enhance economic development in Rakhine State (interview: P25). That said, RNDP framed the contention in the BRI project as a conflict between the periphery and the centre.

The electricity access campaign in Rakhine State was initiated by SGM and AOW (interviews: N45, N47). The energy supply in Rakhine State was unstable and expensive. In 2011, a unit of electricity cost around MMK 400–600 (USD 0.4–0.6), which was supplied by a private company or generated from diesel generators, was over 10 times the rate in central Myanmar (Narinjara 2011b).¹⁸ Consequentially, this energy shortage hampered economic development in the region (interview: N48). SGM’s coordinator Wong Aung, therefore, advocated that all the natural gas should be retained for the Rakhine people (Shwe Gas Movement 2012a). In this regard, SGM viewed the resource-sharing campaign as a means to stop the pipeline project, but the RNDP took the resource-sharing demand as an end in itself. At the beginning, the means and the end of the anti-pipeline campaign were ambiguous. The division only became apparent upon the completion of the gas pipeline construction in July 2013.

The campaign was prompted by the government’s refusal to share natural gas with Rakhine State. On 27 September 2011, Ba Shein, RNDP Member of Parliament (MP) of the Pyithu Hluttaw (House of Representatives), submitted a question to the Ministry of Energy and demanded a share of natural gas for his constituency in Kyaukphyu. The Ministry rejected his demand and stated that the gas would be exported to China through the pipeline as the bilateral agreement prescribed (New Light of Myanmar 2011b, 7). Frustrated by the government’s response, the Action Committee for 24-Hour Electricity was formed in Rakhine State in November 2011. The RNDP was the campaign coordinator (Narinjara 2011a). Soon after, the electricity access campaign scaled up into a state-wide movement. From January to April 2012, young activists affiliated with Rakkha Ahluntan (Ray of Arakan) wore T-shirts with the campaign message ‘Our Gas, Our Future’ in different townships in Rakhine State. In line with the advocacy of SGM and AOW, they demanded that natural gas tapped from Rakhine State not be exported to China unless local people had full access to electricity. In each T-shirt campaign, 50–250 people turned out (Shwe Gas Movement 2012a; Narinjara 2012).

Worrying that Rakhine State’s call for electricity access might destabilise the pipeline implementation, Naypyidaw quickly accommodated the Rakhine people’s demand to deflate tensions in the ethnic state. In early January 2012, the Ministry of Electric Power No. 2, which was in charge of electricity supply generated from oil and gas, announced a plan to extend the national electricity grid to Rakhine State in the fiscal year 2012–2013. It also vowed to electrify townships in Rakhine State, like Toungup, Ann and Kyaukphyu, by 2014 (Juliet Shwe Gaung 2012). Later on, Naypyidaw also promised that natural gas would be reserved for domestic economic development in future contracts signed by the Thein Sein administration (New Light of Myanmar 2012b, 6).

Opposition to pipelines largely cooled down in Rakhine cities in the second half of 2012. Nevertheless, an anti-pipeline protest on Maday Island in April 2013 reignited concern over the pipeline controversy. Villagers who used to be self-sufficient through fishing lost their livelihoods because of the oil pipeline project. Their petition to the MOGE and CNPC was ignored (interview: V16).¹⁹ On 19 April, 400 villagers, mostly dressed in anti-CNPC T-shirts, marched to the Chinese investor’s office (interview: V15).²⁰ When they went closer to CNPC’s compound, everyone became more emotional. Their chanting of ‘CNPC, Get Out!’ became louder (interviews: V18, V19). On the following day of the protest, 10 community leaders were prosecuted for organising an unauthorised protest. In solidarity with the arrested protest leaders, about 600 villagers staged a demonstration in front of the Kyaukphyu court during the trial in May 2013 (Narinjara 2013a). The arrest of Maday Island protesters indicated Naypyidaw’s preference for project continuation. Besides repression, Naypyidaw also worked to gain local people’s support for the project. In response to the Rakhine people’s pushback, it agreed to distribute 20 million cubic feet of natural gas (or 20 per cent of the natural gas shared by Myanmar under the contract) to the ethnic state per day during the gas pipeline opening ceremony in July 2013 (New Light of Myanmar 2013, 16).²¹ The remainder of the natural gas shared by the country would go to central Myanmar. Shan State, however, did not share the quota of natural gas. It appears that the domestic redistribution of natural gas corresponded to Naypyidaw’s perception of the source of threats to the project.

Anti-pipeline mobilisation outside Rakhine State

Throughout the Thein Sein administration, the leading opposition forces in the country were lukewarm about the pipeline controversy. Both 88 Generation and the NLD slammed Naypyidaw for compromising transparency in foreign investment projects (interview: N07), but their stance was not translated into any actions. In central Myanmar, a new alliance MCPWC,²² headquartered in Mandalay, was formed in October 2012. At that time, it was reported that the construction of the pipelines was 80 per cent finished (Nyein Nyein 2012d). The first statement issued by MCPWC urged Naypyidaw to shelve the project until the social and environmental problems caused by the pipelines had been rectified. The coalition quickly adopted a more pragmatic approach to monitoring the post-pipeline construction impacts on local communities (interview: N49). Although MCPWC claimed that it had partner organisations in all 21 townships along the pipelines, it did not organise collective actions in 2012–2013. Public mobilisation concerning the pipeline project in Yangon or Mandalay was somewhat limited.

Anti-pipeline sentiments were less prevailing in Shan State. While the Rakhine MP demanded a sharing of gas resources in September 2011, a Shan MP made a similar request in the ethnic state parliament in June 2017. He asked for 5 per cent of the gas revenue to be shared only with the ethnic state for the environmental and social wellbeing of the ethnic people undermined by the project (Htet Naing Zaw 2017). Before the completion of the pipeline construction, only sporadic collective actions were reported in Shan State. In December 2012, 300 farmers in Hsipaw Township gathered at a prayer meeting to express their worries about the safety of the pipelines (North Shan Farmers Committee 2013). Opposition in Magway Division was somewhat moderate. Two protests broke out in Ngaphe Township in July 2013. Farmers demanded fair compensation as the pipelines passed through the community forest and villagers’ farmland. The turnout of the protests was 30 and 80 respectively (Khin Su Wai 2013; interview: N50). These local protests attracted little media attention.

Movement in the post-pipeline construction period (August 2013 – April 2017)

The opening ceremony of the gas pipeline in late July 2013 (New Light of Myanmar 2013, 16) marked a watershed in the anti-pipeline campaign. Activists conceded it was impossible to stop the project. The anti-pipeline campaign was reoriented to three directions – politicians and activists’ resource-sharing campaign in Rakhine State, villagers’ protests for compensation around the project sites and CSOs’ post-construction monitoring in central Myanmar. Despite a more vibrant mobilisation concerning the pipelines in 2013–2017, Naypyidaw failed to capitalise on the opposition to demand contract renegotiation. RNDP’s resource-sharing demands did not seek to derail the BRI project. The Rakhine leading opposition party’s position on the pipelines exerted tangible pressure on Naypyidaw. Meanwhile, villagers’ protests were highly localised. Statements by pipeline watchdogs were not accompanied by actions. Therefore, Beijing comprehended that the heart of the conflict was the distribution of gains in the pipeline project between Naypyidaw and Rakhine State and thus refused to offer concessions to its counterpart.

The Rakhine’s electricity access campaign was well-organised and successful. After obtaining 20 per cent of the country’s natural gas in the project, RNDP continued advocating for economic development for Rakhine State in the post-pipeline construction period. The Committee for Obtaining the Benefits of Rakhine Resources was formed with the support of other Rakhine CSOs (interviews: N51, N52). A state-wide signature campaign was launched to demand constant electricity supply and budget increase (interview: P25). RNDP leaders delivered literary talks in different townships to promote the cause. One leader recalled that she delivered at least 10 talks in 2013–2015 (interview: P26). Other party members collect signatures through door-to-door visits. About 300,000 people signed the petition (interviews: P27, P28, P29). The Rakhine people also took to the streets to amplify their voice. The biggest demonstration was reported in Rambree Township where 3,000 people staged a protest on 30 September 2013 (Narinjara 2013b). In response, Naypyidaw accelerated the extension of the national electricity grid to Rakhine State. The cost of electricity was reduced to MMK 35 (USD 0.035) per unit in 2014 from MMK 400–600 (USD 0.4–0.6) in 2011 (Narinjara 2014).

Impacted communities staged local protests occasionally following the completion of pipeline construction. During the pipeline construction period, most villagers called for crop compensation for farmers due to mud pollution caused by the pipeline construction (interviews: N53, V20).²³ Meanwhile, some also demanded more economic and social benefits (interviews: N49, N54, V17). The project that spanned across the country prompted tremendous challenges in organising villagers. With the exception of Maday Island and Kyaukphyu Township, most of the villagers lost around one acre of land. Villagers not directly affected by the project might not welcome the project but had less incentive to take political risks to support their fellow villagers who were worse off. Communicating and gathering discontented villagers who scattered in different townships was challenging. From July 2013 onwards, most of the protests took place in Rakhine State. The scale of the actions was usually limited to 100–200 villagers. The media often omitted those protests (interviews: N55, V17). Anti-pipeline protests rarely occurred along the pipelines. In Magway Division, approximately 180 villagers staged a protest in August 2014. Two photo exhibitions supported by Badeidha Moe were organised in Yangon and Magway Division. The turnout in these awareness-raising activities was modest. In Shan State, local people conveyed their grievances through a petition. Roughly 3,000 local farmers participated in TSYO’s signature campaign in July–August 2013 (Shan Herald Agency for News 2013).

MCPWC primarily focused on social and environmental compliances along the pipelines. Activists affiliated with MCPWC demanded transparency in the pipeline project and fair remedies for the villagers. They argued that the campaign could motivate other foreign investors to improve their business practices (interviews: N21, N24, N49). In other words, MCPWC did not seek to change the status quo of the project. In January 2016, it issued a report documenting impacted communities’ grievances, including land confiscation, compensation disputes and environmental degradation in different divisions and states along the pipelines.²⁴ CNPC’s representatives attended the report launch to defend the project. Compared to the Myitsone dam and the Letpadaung copper mine, the China–Myanmar pipelines did not attract much attention. An activist lamented that once the pipelines were laid underground, the issues became ‘out of sight, out of mind’ (interview: N44).

The project did not enter into operation upon the completion of the pipeline construction. The media found that Naypyidaw attempted to renegotiate the taxation and other charges in the oil pipeline project with Beijing, but the two sides reached an impasse (Aung Shin 2015). The oil and gas pipelines are the most strategic BRI project in Myanmar. It is reasonable to expect that Beijing would accommodate Naypyidaw’s request to ensure smooth project implementation. Beijing, however, stood firm and demanded that Naypyidaw comply with the initial agreement. The short delay in the oil pipeline operation could be attributed to the postponement of oil refinery construction in China. As such, it should not be counted as a case of project disruption.

Measuring audience costs of the anti-pipeline campaign

The level of audience costs incurred in maintaining the status quo of the bilateral agreements would influence the two-level game renegotiations. This chapter measures the audience costs generated by the anti-pipeline movement in two phases: from the beginning of the Thein Sein administration till the opening of the gas pipeline (April 2011 – July 2013), and from the beginning of the gas pipeline’s operation to the beginning of the oil pipeline’s operation (August 2013 – April 2017). The resource-sharing campaign in Rakhine State was a well-organised social movement. The campaign was prompted by profit-sharing between the ethnic state and Naypyidaw did not intend to review the terms in the two pipeline agreements. Hence, the resource-sharing campaign’s activities were excluded from the domestic audience cost measurement. Tables 5.3 and 5.4 list the political mobilisation in the anti-pipeline movement before and after the launch of the gas pipeline. This chapter hinges on the audience cost measurement introduced in Chapter 2 to calibrate the anti-pipeline mobilisation with two dimensions – the number of participants and the geographical scope of actions.

In the first phase of the anti-pipeline movement, most of the activities were less confrontational and deemed acceptable by the authorities. In Rakhine State, about 50 farmers in Kyaukphyu Township sent a petition to complain about land confiscation in October 2011. In 2012, in the 24-hour electricity access campaign, activists called for pipeline suspension before local people’s energy needs were met. They put on campaign T-shirts and walked around the cities. The Rakhine people who resided in Yangon organised a similar action in March 2012. More contentious collective actions only emerged in the first half of 2013. The first anti-pipeline demonstration was held on Maday Island in April. A solidarity action was carried out the following month to call for the release of the protest leaders. In Shan State, people communicated their opposition to the pipelines through a religious meeting in December 2012. In Magway Division, impacted farmers demanded land compensation in two small-scale protests in July 2013. Adding up the number of participants from reported anti-pipeline activities, the turnout was about 3,260. Therefore, the small turnout with less than 5,000 participants scored 1 on the 3-point scale. In terms of the geographic scope of actions, most of the activities took place in the states and divisions where the project was located. At least one action took place in Yangon. However, collective actions did not spread to other parts of the country beyond the project-impacted areas and Yangon. Therefore, the regional mobilisation scored 2 on the 3-point scale. The value of political mobilisation was recorded at 2 (value of the number of participants × value of the geographical scope of action) (see Table 5.5).

Table 5.3: The level of mobilisation in the first phase of the anti-pipeline movement (April 2011 – July 2013).

Forms of mobilisation	T-shirt campaigns, public meetings, protests and petition
Locations	Mainly in Rakhine State, also in Mayway Division, Shan State and Yangon
Estimated turnout	About 3,260

Source: Data compiled by the author.

Table 5.4: The level of mobilisation in the second phase of the anti-pipeline movement (August 2013 – April 2017).

Forms of mobilisation	Protests, photo exhibitions, report launch and petition
Locations	Mainly in Rakhine State, also in Mayway Division, Shan State and Yangon
Estimated turnout	About 3,980

Source: Data compiled by the author.

Table 5.5: Political mobilisation and domestic audience costs in the anti-pipeline movement (April 2011 – July 2013).

	Value
Number of protesters	1
Geographical scope of action	2
Score for political mobilisation	2
Level of audience costs	Low

Source: Author’s summary.

In the second phase of the anti-pipeline movement, more CSOs supported impacted villagers. Nonetheless, sporadic and parochial actions were organised, but most of the actions were confined to Rakhine State. Protests rarely emerged in other states and divisions. Like the first phase of the movement, the Shan people refrained from expressing their grievances through contentious actions. A petition was sent to the President in 2013. The MCPWC’s report launch in 2016 was one of the few actions held in Yangon. Adding up the number of participants from reported anti-pipeline activities, the turnout was about 3,980. Therefore, the small turnout, with less than 5,000 participants, scored 1 on the 3-point scale. In terms of the geographical scope of actions, almost all the actions took place along the pipelines – in Rakhine State, Magway Division and Shan State. Only a few actions were held in Yangon. Therefore, the regional mobilisation scored 2 on the 3-point scale. The value of political mobilisation was recorded at 2 (value of the number of participants × value of the geographical scope of action) (see Table 5.6). This study argues that political mobilisation and audience costs are correlated, even though they are not identical. A low level of political mobilisation could only generate a low level of audience costs for project continuation (see Figure 5.5).

Table 5.6: Political mobilisation and domestic audience costs in the anti-pipeline movement (August 2013 – April 2017).

	Value
Number of protesters	1
Geographical scope of action	2
Score for political mobilisation	2
Level of audience costs	Low

Source: Author’s summary.

Figure 5.5: The level of audience costs incurred in continuing the pipeline project.

Note: AC: audience costs

Source: Author’s depiction.

Analysis: Audience cost mechanism in the pipeline case

The level of audience costs is an independent variable that could activate the two-level game and open opportunities for agreement renegotiations. A low level of domestic audience costs incurred from implementing the pipeline project did not put much pressure on Naypyidaw in bilateral cooperation. Naypyidaw did not face an audience cost dilemma in the pipeline project’s implementation. Even though Naypyidaw attempted to renegotiate the transmission fee of the oil pipeline with Beijing, the latter stood firm. The pipeline contracts were signed in 2010, and Beijing expected its counterpart to fulfil international obligations. Without formidable domestic constraints that barred Naypyidaw from implementing the projects, Beijing would not have incentives to revisit the agreements.

Table 5.7: Audience cost mechanism in the anti-pipeline campaign.

	Assessment	Observations
Audience costs	phase 1 (Mar 2011 – Jul 2013): low	low level of political mobilisation in the anti-pipeline activities (number of participants: low; geographical scope of action: regional); and opposition parties’ reaction: Aung San Suu Kyi and the NLD did not make any comment on the project; RNDP demanded resource-sharing.
	phase 2 (Aug 2013 – Apr 2017): low	low level of political mobilisation in the anti-pipeline activities (number of participants: low; geographical scope of action: regional); and opposition party’s reaction: RNDP did not oppose to the project but demanded benefit-sharing with Naypyidaw.
Naypyidaw’s preference	contract renegotiation	accommodation: resource-sharing with Rakhine State; and protest management: moderate repression.
Beijing’s perception	dismissal of domestic constraints in Myanmar	concessions: refusal to renegotiate contract terms; and public diplomacy: limited, focused on Rakhine State.
Project outcome	maintenance of the status quo of the project. The operation of the gas pipeline and the oil pipeline began in July 2013 and April 2017 respectively.

Source: Author’s summary.

A low level of domestic audience costs in the anti-pipeline campaign

The transnational anti-pipeline campaign was launched in the late 2010s. Local actions emerged in Rakhine State with the support of cross-border CSOs, like AOW and SGM, when the political transition began in 2011. Notwithstanding strong mobilisation in Rakhine State in the resource-sharing campaign, the purpose of the movement sought to extract more benefits from Naypyidaw in the project. The turnout of the anti-pipeline activities was low and concentrated in Rakhine State throughout the Thein Sein administration. In the first phase of the movement, impacted communities protested to demand land and crop compensation. Most of the protests took place on Maday Island and Kyaukphyu. Outside Rakhine State, not much reaction from other parts of the country was reported. The completion of the gas pipeline construction marked the second phase of the anti-pipeline movement. Major pipeline watchdogs shifted attention to social and environmental non-compliances in the projects. Stalling the pipelines was not their agenda. Furthermore, there was no influential ally backing the anti-pipeline movement. The NLD and 88 Generation did not intervene into the controversy. A low level of domestic audience costs could not challenge the status quo of the project.

Naypyidaw’s preference over project continuation

Naypyidaw’s preference for the project’s continuation was observed by its energy policy’s adjustment in Rakhine State. The anti-pipeline contention was partially rooted in the disproportionately high electricity rate in Rakhine State. Naypyidaw initially refused RNDP’s demand to share natural gas with the ethnic state. It softened its stance and distributed 20 million cubic feet of natural gas tapped from the Shwe gas fields to Rakhine State in the wake of mounting local contention. The fact that Shan State did not benefit from the share of natural gas implied that Naypyidaw’s concession was a direct response to social resistance on the ground. Naypyidaw’s protest management also indicated its preference regarding the project continuation. In April 2013, community leaders on Maday Island were prosecuted for organising unauthorised protests. The denial of protest permits and the imprisonment of leaders exhibited Naypyidaw’s willingness to contain domestic audience costs in the controversy. The mixed approaches to the Rakhine people’s demands reaffirmed Naypyidaw’s commitment to the project implementation.

In spite of the intention to renegotiate gains in the oil pipeline with Beijing, Naypyidaw refrained from making any public statement. The quiet negotiations showed that Naypyidaw avoided provoking nationalism that could increase domestic audience costs in the controversy. The opposition parties helped to signal public opinion on the BRI agreements. The RNDP mainly cared about how the Rakhine people could benefit from the project. Meanwhile, the NLD did not include the pipeline implementation on its agenda even though the project passed through central Myanmar. Beijing dismissed the request for gain renegotiations without visible domestic pressure that might block Naypyidaw from honouring contractual duties.

Beijing’s refusal to redistribute gains with  Naypyidaw

The oil pipeline project connected to several strategic BRI projects in Rakhine State. It is surprising that Beijing refused to offer concessions to Naypyidaw. Beijing neither revised the contractual terms nor diplomatic approach. This study contends that Beijing dismissed Naypyidaw’s constraints in the transboundary pipelines. The domestic audience did not call for the stall of the projects but demanded benefits from the Sino–Myanmar cooperation. Both CNPC and the Chinese embassy reacted quickly when a visible challenge to the pipelines surfaced. In the wake of Rakhine societal actors’ demands for electricity access, CNPC-led consortiums donated USD 10 million to construct power lines in Rakhine State which facilitated local people’s access to electricity in March 2012. Later on, CNPC promised that the consortiums would donate USD 2 million annually for local development programs (Yu 2012a). Following the largest protest on Maday Island, CNPC held a press conference in Yangon to present its CSR achievements in May 2013. As of 2016, CNPC had supported 120 CSR initiatives in Myanmar, including school renovation, donation to clinics and aid delivery. There were 43, 41, 23 and 13 projects in Rakhine State, Shan State, Mandalay Division and Magway Division respectively (China National Petroleum Corporation 2017). Variations in donations for different areas appeared to correspond to the level of opposition along the pipelines. Conversely, CSO members, for instance, those affiliated with MCPWC, complained that CNPC was reluctant to meet with them (interview: N56). A few Myanmar-based Chinese state-owned enterprise (SOE) employees explained a lack of communication between their companies and CSOs as they did not believe that CSOs could represent local people’s interests (interview: C02). However, during the MCPWC report launch in 2016, CNPC representatives were eager to present the company’s narratives to the local media organisations at the CSO event.

Beijing’s engagement with the Rakhine stakeholders corresponded to the level of resistance in the region. In May 2013, Chinese ambassador to Myanmar Yang Houlan visited Maday Island (Embassy of the People’s Republic of China in Myanmar 2013). The meeting took place after a few hundred villagers organised an anti-pipeline rally. Meanwhile, Beijing has regularly invited Rakhine opposition leaders to China at least once a year since 2013 (interviews: P05, P25). Chinese investment projects in Myanmar were always on the itineraries. Besides the pipelines, the Chinese host also arranged for Rakhine opposition leaders to meet with CITIC, the Chinese investor of the deep sea port and SEZ in Kyaukphyu. Although Rakhine politicians brought up controversies about the pipeline in the meetings in the tours, the Chinese organisers were more interested in seeking local stakeholders’ support for the forthcoming BRI projects in Rakhine State (interviews: P05, P30).

Alternative explanations for the maintenance of the project status quo

The pipeline project was known as one of the controversial BRI projects during Myanmar’s political transition. In the same period, Chinese SOEs experienced setbacks in the Myitsone dam and the Letpadaung copper mine. Even with the growing discontent with Chinese investments, there was no major disruption to the pipelines. CSO leaders and Myanmar pundits offered several propositions for the maintenance of the status quo of the pipeline project, including Chinese strategic interests in the project, the involvement of international investors, and the eruption of communal conflict. These accounts enriched our understanding of the project but did not adequately address Beijing’s responses to Naypyidaw’s gain redistribution request.

Beijing’s stake in the project

Analysts posited that Beijing would not tolerate any interruption in the transboundary pipelines that concerned its national energy security (Simpson 2014; Sun 2012a). This study agrees that Beijing would not want the pipeline project to be derailed. Arguably, Beijing could have offered concessions in exchange for oil pipeline operation. It, however, rejected requests from the Thein Sein administration and the NLD-led government to redistribute gains. In the absence of tangible political risks in cooperation, Beijing insisted that the project should be implemented as had been planned. Moreover, Beijing has not shifted its diplomatic approach in the pipeline case. Rakhine politicians were invited to China a few times, along with leaders from other ethnic parties. The pipeline case was not the primary issue for discussion. CNPC stepped up CSR programs but a lack of public engagement with impacted communities impeded its efforts to win local people’s support for the project.

The pipeline project’s multinational profile

It is observed that CNPC attempted to frame the pipeline project as an international undertaking to mitigate business risks (see Sun 2013; Li et al. 2021). Following the setbacks in the Myitsone dam and the Letpadaung copper mine, anti-Chinese project sentiment had grown. CNPC often reiterated that the pipeline project was international cooperation formed by six companies from four countries (Southeast Asia Oil Pipeline Co. and Southeast Asia Gas Pipeline Co. 2016). However, the transboundary pipeline project was widely known as the most important BRI project in Myanmar. CNPC’s leading role in the consortiums also made it hard to downplay the Chinese character of the project. The gas pipeline began operation earlier than the oil pipeline could be attributed to the multinationalities of the gas pipeline. Renegotiations about transmission fee in the gas pipeline could be more complicated with the involvement of multiple parties (see Raiffa 1982). It is plausible that Naypyidaw did not request any change in the gas pipeline operation for this reason. By contrast, the oil pipeline only involved CNPC and MOGE which should make negotiations less complicated. Both the Thein Sein administration and the NLD-led government urged Beijing to redistribute gains in the oil pipeline but failed. The implementation of the project without tangible domestic obstacle remained a single-level game during the political transition.

The outbreak of communal violence

A few CSO leaders blamed communal violence in Rakhine State in 2012, and in Mandalay in 2014, for distracting public attention from the pipelines (interviews: N08, N27). In July 2012, the clash between Rohingya and Buddhists left 200 dead and thousands displaced in Rakhine State. Waves of violent incidents continued in 2013 and 2014. In June 2014, the clash between Muslims and Buddhists killed two and injured five in Mandalay (Lipes 2014; BBC News 2014). Noting that society had been traumatised by violent incidents, most of the organisations concerned with the pipeline project did not directly involve in the investigation or reconciliation of the sectarian violence. Also, in areas not affected by the clashes, for instance, Magway Division and Shan State, little political mobilisation was observed from 2012 to 2017. Furthermore, communal violence had not affected the electricity access campaign. As such, communal violence was not a major obstacle to anti-pipeline mobilisation. Beijing stood firm in the oil pipeline as it was not convinced that Naypyidaw encountered domestic constraints in project implementation.

Concluding remarks

The continuation of the pipelines refuted the state-centric argument that US–China competition led to the derailment of BRI projects. The pipeline case reaffirms domestic factors’ significance in shaping international outcomes. A high domestic audience cost is a necessary factor to activate the two-level game negotiations. Provided that the state-coordinated investment did not face formidable challenges amid the political transition, Naypyidaw was not trapped in an audience cost dilemma in project implementation. Two conclusions can be drawn from this case study. First, the transnational anti-pipeline movement had its contributions and limitations in the implementation of the project. Cross-border organisations were successful in raising the international community’s awareness of the BRI project, but ineffective in building resistance to challenge the project. The transnational movement emerged when political opportunities were closed in Myanmar. It exposed human rights violations caused by the dual pipeline project. However, the mobilisation of shame was not accompanied by additional economic pressure on Naypyidaw. More importantly, the transnational movement failed to probe divergent domestic demands in the pipeline controversy. In Rakhine State, people’s grievances were rooted in economic deprivation. Ethnic nationals demanded a fair share in the agreement instead of calling for a stall of the project.

Second, a high level of domestic audience costs was a prerequisite for renegotiating a BRI agreement. Beijing ignored their counterpart’s request for gain redistribution without visible domestic constraints that could undermine Naypyidaw’s legitimacy. The popular state-wide resource-sharing campaign in Rakhine State did not generate a bargaining advantage for Naypyidaw. Beijing observed the electricity access campaign in Rakhine State was a tug-of-war between the ethnic state and Naypyidaw. Opposition to a domestic policy could not be translated into domestic audience costs in a bilateral agreement’s implementation. Furthermore, a lack of an influential ally, especially from central Myanmar, impeded the growth of the anti-pipeline campaign. In the absence of significant political mobilisation against the pipelines, Beijing pressured Naypyidaw to fulfil its contractual obligations.

The implementation of the pipelines was connected to other prospective BRI projects, namely, the Kunming–Kyaukphyu high-speed railway, which would run parallel to the pipelines, and the Kyaukphyu deep sea port and SEZ. CNPC’s business practices affected local people’s receptiveness to new BRI projects. Nevertheless, whether new BRI projects could be implemented successfully depends on the negotiations among impacted communities, Naypyidaw and Beijing. The next chapter discusses the stability of BRI projects under the Aung San Suu Kyi-led administration.

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1. 1 Arakan was the colonial spelling of Rakhine that was used in Myanmar before 1989. See footnote 10 in Chapter 1.

2. 2 Some media sources suggest that about 80 per cent of China’s oil import travels through the Malacca Strait (Chen and Aung Hla Tun 2016; Fang and Feng 2017).

3. 3 The issue of the ‘Malacca Dilemma’ was first put forward by Chinese President Hu Jintao at the Central Economic Work Conference in 2003 (Andrews-Speed and Dannreuther 2011, 139–40).

4. 4 Other cross-border oil and gas pipelines include the China–East Siberia gas pipeline, the China–Kazakhstan oil pipeline and the China–Turkmenistan gas pipeline. The China–Pakistan oil and gas pipeline project, part of the China–Pakistan Economic Corridor, is under planning.

5. 5 Korean conglomerate Daewoo International controls a 51 per cent stake in the two gas fields. Korea Gas Corp. has an 8.5 per cent stake. The two Indian companies – ONGC Videsh Ltd and GAIL – hold 17 per cent and 8.5 per cent. The remaining 15 per cent is shared by Myanmar Oil and Gas Enterprise (MOGE) (Bangkok Post 2013).

6. 6 On 16 June 2009, a memorandum of understanding (MOU) for the oil pipeline project was signed between China National Petroleum Corporation (CNPC) and Myanmar’s Ministry of Energy, witnessed by Myanmar’s second-highest-ranking leader Vice Senior-General Maung Aye and then Chinese Vice-President (current President) Xi Jinping in Beijing (China National Petroleum Corporation 2009a). Another agreement that stipulated the rights and obligations of shareholders in the oil pipeline project was concluded during Xi Jinping’s trip to Myanmar in December 2009 (China National Petroleum Corporation 2009b). Negotiations for the gas pipeline that would transport natural gas from Myanmar’s offshore gas field have been more complex as the project involved multiple stakeholders.

7. 7 The refinery in Yunnan Province is a critical component of the oil pipeline project. It was scheduled to be completed in 2015 but has been postponed several times because of street protests and stronger legal enforcement of environmental standards by Chinese authorities (Chen 2016). The construction of the refinery only finished in July 2016.

8. 8 This study sets the exchange rate of US dollar against Myanmar kyats as USD 1 = MMK 1,000 in the period of 2011–2016. See footnote 12, Chapter 4.

9. 9 My observations during the visit to Maday Island, Rakhine State in January 2016. Rubbish, including broken glass, was scattered around the local people’s pier.

10. 10 Myanmar took steps to apply for membership in the Extractive Industries Transparency Initiatives in December 2012. EITI members are required to reveal their revenue from the oil, gas and mining sectors (Extractive Industries Transparency Initiative 2012).

11. 11 Margaret Keck and Kathryn Sikkink (1998) describe the ‘boomerang pattern’ of transnational activism, where domestic opposition bypasses the home government and appeals to international allies to exert pressure on the state.

12. 12 The project transports natural gas from Myanmar to Thailand by underwater pipelines and underground pipelines that cut across Myanmar’s Tenasserim Division. It was a joint venture among Unocal (the United States), Total (France) and PTT Exploration and Production (Thailand).

13. 13 Earth Rights International (ERI)’s international legal campaign finally made Unocal and Total settle the cases outside court by paying a huge amount of compensation to the affected communities in 2005 (Holliday 2005). It is reported that Unocal ended the lawsuits by paying USD 30 million in March 2005. Meanwhile, Total settled the case outside court by compensating the plaintiffs in the sum of USD 6 million in the same year (Simpson 2014).

14. 14 Soon after the discovery of Shwe Gas by the Daewoo-led consortium in 2003, ERI issued a report called Another Yadana: The Shwe Natural Gas Pipeline Project (Myanmar–Bangladesh–India) in 2004. ERI urged Daewoo to suspend the investment until Myanmar became a democratic country to avoid the human rights violations caused by its business activities (Earth Rights International 2004). At that time, CNPC and the Chinese Government were not yet the campaign’s target.

15. 15 These publications were usually produced with the help of cross-border groups, from background research to report writing (interview: N44).

16. 16 The reports were uploaded online, but the websites could not be accessed in Myanmar before September 2011 (Simpson 2014, 177).

17. 17 The Rakhine Nationalities Development Party (RNDP) was the most influential opposition party in Rakhine State. In the 2010 general elections, the RNDP contested 44 parliamentary seats and won 35 of them. In early 2014, it merged with the Arakan League for Democracy (ALD) to form the Arakan National Party (ANP). In the 2015 general elections, the ANP won 22 out of 44 seats. However, the ALD officially split from the ANP in July 2017 (Ei Ei Toe Lwin and Nyan Lynn Aung 2017).

18. 18 Each unit of electricity cost only MMK 28–50 (USD 0.03–0.05) in central Myanmar in 2011 (Narinjara 2011b).

19. 19 From January to April 2013, the Maday Island Development Association organised monthly meetings to discuss how to react to the pipeline project that destroyed their livelihoods. In each meeting, 200–300 villagers showed up (interview: V16).

20. 20 The number of protesters estimated by interviewees ranged from 400 to 800. Figures reported by the media also varied.

21. 21 It is reported that 100 million cubic feet of natural gas, about 20 per cent of the gas transported through the pipeline to China, would be reserved for Myanmar’s daily use. While 20 million cubic feet of gas would be sent to Kyaukphyu per day, 23 million cubic feet would be sent to Yenangyoung, Magway Division. The remaining 57 million cubic feet would be transported to Taungtha, Mandalay Division (New Light of Myanmar 2013, 16).

22. 22 As of mid-2015, the Myanmar–China Pipeline Watch Committee (MCPWC) had 38 organisation members, including community-based organisations in the 21 townships affected by the pipeline project (interview: N49).

23. 23 The rainy season usually intensified conflict between farmers and CNPC because it was the time when construction waste contaminated farmland through rainwater.

24. 24 CSO Badei Dha Moe also conducted surveys to monitor the post-construction impacts of the pipelines in 2013 and released their report the following year.