Two Chinese workers abducted at protest-plagued mine in Myanmar

YANGON Mon May 19, 2014 7:06am EDT

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YANGON (Reuters) - Two Chinese workers have been abducted at a copper mine in Myanmar at the centre of a long-running dispute over land rights and their company said on Monday it was worried they would be harmed unless it stopped work.

Two Chinese contractors and a colleague from Myanmar were abducted on Sunday but the Myanmar national was freed the same day, said Cao Desheng, a spokesman for Myanmar Wanbao, a unit of Chinese weapons manufacturer China North Industries Corp.

"We are very worried about our Chinese colleagues," Cao told Reuters. "We hope and pray for their safe release."

Cao said a group calling itself the "Student Network of Mandalay" had contacted the company and told it to stop its work or it would harm the two workers. Mandalay is central Myanmar's main city.

"We don't know who these activists are," Cao said, adding that company officials had been negotiating with communities around the mine about its expansion.

"We do know some villagers aren't accepting the project," he said.

The Letpadaung mine in Monywa, about 100 km (60 miles) west of Mandalay, has faced protests from residents of the area who say thousands of acres of land were illegally confiscated to make way for its expansion.

In November 2012, riot police raided camps set up by protesters, injuring more than 100 people, including at least 67 monks.

The incident was a public relations disaster for a quasi-civilian government that had taken over from a long-ruling military junta in March 2011.

The government later renegotiated the original contract so that it now takes 51 percent of the profit, while putting aside $3 million for social projects. Myanmar Wanbao gets 30 percent of the profit and Union of Myanmar Economic Holdings Ltd (UMEHL), owned by Myanmar's military, 19 percent.

Under the original contract, UMEHL got 45 percent and Myanmar Wanbao 51 percent.

Sporadic protests have continued despite Myanmar Wanbao's promises of community development projects.

Myanmar Wanbao said it had been in talks with residents opposed to the mine for five months.

"We have consulted them, sat with them, ate with them and have reached out to them repeatedly," the company said on its website. "This is why we are greatly horrified by this senseless act of violence."

Cao Desheng said the company had asked police not to launch any rescue operation while village elders attempted to secure the captives' release.

"If any operations are undertaken, then the destiny of our two Chinese colleagues will be out of control," he said.

(Reporting by Jared Ferrie; Editing by Alan Raybould and Robert Birsel)

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