Far East: Thailand

FAR EAST

Tony Sitathan, Contributing Editor, Singapore (Indonesia, Malaysia, Thailand, Viet Nam, Myanmar, Brunei, Cambodia and MTJDA)

Thailand

Under the present government of Thaksin Shinawatra, there are strong indications that the oil / gas industry will play a more significant role in Thailand although, for the domestic industry, petroleum consumption has been on the decline. Thailand’s GDP has been somewhat flat for the past two years, hovering around 3.5%.

Thailands’ Department of Mineral Resources plans to develop 87 petroleum concessions located in the Gulf of Thailand and the Andaman Sea. Thai Shell, together with PTTEP, plan to develop the L10/43, L11/43, L21/43 and L22/43 tracts. China’s CNPC intends to develop one of the tracts; Pacific Tiger Energy (Thailand), L44/43; and Harrods Energy / Chevron Offshore Thailand, tract G4/43.

The Petroleum Authority of Thailand (PTT) intends to defer its privatization program until the end of 2001.

Exploration. PTTEP ventured into two offshore PSC areas in Viet Nam in November 2000. This project was approved by Viet Nam’s Ministry of Planning and Investment, and PetroVietnam. Using its two subsidiaries, PTTEP Southwest Vietnam and PTTEP Lim Long Vietnam, it has a 10% share in Block 52/97, Block B and Block 48/95, which cover a total area of 16,463 km², east of Songkhla province. These blocks are operated by Unocal.

PTT and the Japan National Oil Corp. (JNOC) have agreed to work together to conduct a joint study on gas supplies and pipeline capacities in the offshore Greater Gulf of Thailand Region.

For the second phase of the Pailin Project in Block 12/27, PTTEP intends to spend $1.5 billion over five years to boost petroleum sales and gas production. It also intends to maintain an average of 550 MMcfd at Bongkot field, drill 10 more exploration / delineation wells in Arthit project and raise production in Pailin to 330 MMcfd by mid-2002.

Thailand and Cambodia intend to jointly develop offshore oil and gas resources in the Gulf of Thailand.

Development. Chevron Offshore Thailand awarded a contract to BJ Tubular Services for well services, including casing and tubing running, at its Tantawan, Benchamas and other fields in the Gulf of Thailand. Smedvig Asia, a subsidiary of Sweden’s Smedvig ASA, has signed a letter of intent with Unocal Thailand for a drilling contract in the Gulf. Clough Ltd. has a strategic alliance with Unocal and Unithai Shipyard to construct and install wellhead platforms and submarine pipelines worth Aus $250 million in the Gulf. The project is intended to take seven years.

Production. PTTEP intends to increase production in the Yetagun project in Blocks M12, M13 and M14 by at least 10%, to 260 MMcfd, by 2006. Thai Shell Exploration & Production intends to revive its oil production in Nang Nuan field in B6/27. Two wells were drilled on the structure. One of the two wells was Nang Nuan B01 that has produced 4,250 bopd for the past four years; the other is an offshore location on the structure at Chumphon Coast, in 19-ft water. The Unocal Group is Thailand’s largest gas producer, delivering up to 1.1 Bcfd from 13 offshore fields in the Gulf, more than 60% of the country’s total output of 1.9 Bcfd.

   Chevron, over the next three years, wants to spend $400 million in oil / gas exploration, emphasizing production in the Gulf. Its North Jarmjuree field, the fourth so far in Chevron’s Block B8/32 concession, will be online in mid-2003 at an estimated 50 MMcfd, increasing to 190 MMcfd and 6,000 bpd condensate by 2005. This includes installation of eight offshore platforms and drilling of 60 wells. Chevron also has three other fields: Tantawan, Benchamas and Maliwan – estimated to contain over 2.5 Tcf gas and 350 MMbbl oil.

   Pogo Producing has managed to sustain production from its first three Benchamas platforms, grossing 150 MMcfd and 36,000 bopd. It expects production to increase over the next two years. Pogo was awarded a production license in the northern part of Jarmjuree, and exploration programs in Kung and Jarmjuree in February 2001. By 2001, Pogo intends to have drilled 52 wells in Thailand.

   PTT has completed construction of a 96-mi-long, 30-in. pipeline linking Wong Noi power plant in the central region to a delivery site in Ratchaburi. It has a current delivery capacity of 300 MMcfd and can easily accommodate up to 500 MMcfd. By building Thailand’s gas pipeline infrastructure and improving its load factor, PTT hopes to increase annual gas sales by 10% within a three to five year period.