Huge gas deposits off Myanmar's coast have sparked an international scramble for a slice of the action, which strengthens the military government but brings only more trouble for impoverished locals. They are the largest gas deposits in this energy-hungry region. In an attempt to curry favour, India provided government loans and the South Korean company Daewoo gave the junta an arms factory. But it is China that will take the gas home. The contracts for three offshore blocks were signed last year, three days after Beijing vetoed a UN resolution criticising Myanmar's human rights record. At the centre of this bonanza is the sleepy island of Rambree. Rambree was once the scene of heavy fighting between the British and Japanese in the second world war. Today, the principal activities are fishing, agriculture and playing soccer on the beach. Soon, it will be the starting point for a pipeline carrying gas and oil to China. Foreigners are not welcome. The gas deposits in the Shwe ('Golden') A1 block, a few nautical miles off the coast, are worth between US$37 billion and US$52 billion. The waters covering this treasure have been closed to local fishermen and it is impossible to witness the work going on there. But the area's immense energy wealth is visible onshore at Yenang Taung ('Oil Mountain') village, where locals have built thousands of rudimentary oil wells. They drill with spluttering machines or by hand, pounding the ground with an iron spike suspended on a bamboo frame. The oil is sold to local businessmen or used for domestic lighting, because there is no electricity here. According to a local activist, the village paid the equivalent of HK$91,600 to the army and local authorities for the right to extract oil last year, 'but when some senior officials come to the area they have to dismantle and hide their [drilling] materials'. In April there were clashes between locals and a Chinese oil company that took over their land, allegedly without paying compensation. It is little wonder that few people expect to benefit from the offshore gas. Even in the town of Kyaukpyu there is electricity for only one hour and 45 minutes a day. There are about five cars, which all belong to top officials. The pipeline will start from Kyaukpyu, where the gas will come ashore, and carry it 1,440km to Kunming in southwestern China. Next to the naval base at Kyaukpyu, a deep-water harbour is being built. It will be a terminal for oil from the Middle East and Africa, which will be piped to China along the same route. It is a crucial strategic development for China, easing what President Hu Jintao has called the 'Malacca dilemma' - his country's dependence on shipping through the narrow Malacca Strait. Meanwhile, the Shwe Gas Movement, a campaign group, estimates Myanmar's regime could make US$17 billion over 20 years from the A1 block alone. 'People are afraid they will lose their land,' said a local man. Residents of Baday (aka Myaday) Island have reportedly already been told they must leave their homes - without compensation. The whole island, now containing five villages, will be dedicated to the energy industry. But in Myanmar there is no public information about these projects, and little public discussion. 'When the people discuss it, they are scared,' said a local activist. 'The gas belongs to all the people of the region. It shouldn't be taken unless they benefit. Only the army will get money. They will use it to buy weapons to kill the people.'