Courcy’s Intelligence Brief

The Burma-China oil and natural gas pipelines, referred to by the official Xinhua news agency as “China’s new strategic energy channels”, are on target to be completed by 30 May.  According to Gao Jianguo, head of the pipeline project for the China National Petroleum Corporation (CNPC), the oil and gas pipelines will be operating in early June barring any unforeseen problems.  The Burmese section has been finished and those sections within Chinese territory will be completed this month, after which the pipelines will undergo pressure tests.

The 1,100km oil and gas pipelines will carry oil and natural gas from the port of Kyaukpyu on Burma’s west coast to China’s Yunnan Province.  The oil pipeline will have a capacity of 22m tonnes per annum, with the natural gas pipeline designed to carry 12bn cubic metres of gas per annum.  The key strategic advantage is that it enables oil from the Middle East to bypass the Strait of Malacca and other vulnerable sea lanes.  It will also increase the supply of energy to China’s underdeveloped southwest.

On 20 January, China and Burma held a Strategic Security Consultation between senior officers of their respective armed forces.  One of the key topics was how to stop the conflict with Kachin rebels near China’s south-western border.  A ceasefire between the Kachin Independence Army (KIA) and the Burmese government broke down in 2011, and fighting escalated during December following a government offensive.  Some Burmese artillery shells landed on Chinese territory on 30 December and again on 17 January, prompting Beijing to demand an “immediate ceasefire”.  The new oil and gas link passes just south of the area of fighting.

The Kachin issue is particularly sensitive to China as the KIA gets support from China’s ethnic Kachins (known as Jingpo), who have a population of about 132,000.