Thailand's new-round petroleum concession awaits NLA move

BANGKOK, February 27 (TNA) - The Ministry of Energy has reiterated that it will wait for the National Legislative Assembly (NLA)'s move and will not, in the meantime, appoint committee members to jointly sit with the Energy Reform Network in settling problems concerning the government's new-round concession for petroleum exploration and production in Thailand. Puangthip Silpasart, Director-General of the ministry's Department of Mineral Fuels, quoted Thai Energy Minister Narongchai Akrasanee as declaring the stance on Friday. Puangthip explained that Thai Prime Minister General Prayut Chan-ocha has ordered NLA to either amend the existing Petroleum Act or draft a new law on petroleum exploration and production, in which the government could adopt a production sharing contract (PSC) with concessionaires. Puangthip said it is, therefore, unnecessary to appoint committee members to sit with the Energy Reform Network in making any decision, noting that her department has already given information in details over the past few years. According to the senior official, NLA will set up a committee to consider the issue, in which two members come from her department. The senior official pointed out a new law on using the PSC system, if promulgated, will require the establishment of an PSC organisation which would take years for a supervision, while demand for natural gas in Thailand has kept rising in contrast to the country's declining production and reserves. The senior official cautioned that a petroleum exploration project will take at least six years; so, if nothing was done, Thailand would have to import liquefied natural gas (LNG), which would carry high costs and could be used for the electricity production only, affecting petrochemical and related industries in the country. On suggestions that the government itself conducts petroleum exploration, the senior official stressed that no government in the world would invest by itself due to a huge investment fund and high risks of a business loss from low productivity in an exploration project. The senior official cited the existing 20th round of petroleum exploration, whose concession period is due to expire soon, as an example that the private sector invested up to 16 billion baht and an investor in one plot found nothing, while others returned 20 other plots, proving that investment is extremely high. (TNA)