Yet Another Battle for Chevron

I usually consider myself to be knowledgeable about geography and geopolitics, especially as they relate to oil and gas production. But I'm somewhat ashamed to admit that, until recently, if you'd asked me to identify Myanmar, I'd probably have guessed it to be a fancy brand of oven cookware.

Myanmar is the name for what used to be called Burma. You probably knew that. And you might have realized that, save for occasional, short-lived efforts at democracy, Myanmar has been ruled by its military for nearly five decades. Recent protests led by Buddhist monks over higher fuel prices expanded into even bigger demonstrations calling for democracy in the impoverished country. A resulting brutal crackdown by the military regime resulted in the deaths of 200 protestors, according to the Associated Press, and generated international outrage.

All of this has also led to Total (NYSE: TOT  ) and Chevron (NYSE: CVX  ) , which produce natural gas off the nation's coast in the Yadana field, being accused of turning a blind eye to the excesses of the dictatorship and even to funneling funds to it. The most recent result was a "Chevron Protest in Burma" earlier this week involving calls to the company demanding that it escrow royalties, rather than pay them to the regime, and beyond that, that the company contribute to humanitarian programs in Myanmar. On Thursday, from the other side, the junta accused the West of fomenting its country's upheaval.

These events have occurred as Chevron and Italy's Eni (NYSE: E  ) are battling with the government of Kazakhstan on separate fronts. It also follows recent departures under state pressure by Royal Dutch Shell (NYSE: RDS-A  ) (NYSE: RDS-B  ) and BP (NYSE: BP  ) from big Russian projects. And then there's Hugo Chavez handing out eviction notices to six big oil companies in Venezuela earlier this year.

Chevron, embattled on a number of fronts, recently warned about impending softer-than-expected quarterly results. Indeed, in addition to those mentioned above, I'd say the jury's still out on the company's new venture in China. As such, and although Myanmar admittedly is small potatoes in Chevron's overall scheme of things, there's just too much noise springing up around the company. I'm inclined to take a pass on shares until both its operating economics and its geopolitical squabbles become more settled.

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