Quick Take: CNOOC and the Junta

If you've thought about investing in CNOOC (NYSE: CEO  ) , you may already know that the Chinese oil and gas concern has operations in the country formerly known as Burma. You probably also know that "Myanmar" is a miserable place run by tyrants. While you may be inclined to turn a blind eye to the company's dealings with such unsavory people, the U.S. Treasury Department is not.

On Monday, the Treasury's Office of Foreign Assets Control placed sanctions on a leading Burmese family. The elder gentleman, Lo Hsing Han, is known as the "Godfather of Heroin." His conglomerate, Asia World, is run by son Stephen Law, and does all manner of contract work for the military junta. Stephen's wife holds a Singaporean company called Golden Aaron, which is one of CNOOC's joint venture partners in its Burmese oil field concessions.

We are talking about the very company listed here in the U.S., not CNOOC's state-owned parent. There is no dodging the direct connection, as Buffett did with his investment in Sudan-stainedPetroChina (NYSE: PTR  ) . As a foreign company, CNOOC will not be slapped with an Alien Tort Claims suit a la Boeing (NYSE: BA  ) or Chevron (NYSE: CVX  ) subsidiary Unocal, but I hope the company's connection to drug traffickers and a murderous military regime is enough to make you think twice before buying a piece of the business.


Read/Post Comments (0) | Recommend This Article (5)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 585505, ~/Articles/ArticleHandler.aspx, 8/1/2014 6:39:07 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement