Next petroleum concession bid set to go ahead eventually, agency says after delay

Puangthip Silpasart, director-general of the department, said yesterday that even though the government had extended the deadline for submitting bids from today to March 16, and would probably fail to satisfy the civil groups opposing the concession scheme at the public hearing on Friday, the department still believed the government will eventually push forward with the plan.

The department has gathered contentious issues to be submitted to the government, such as a comparison of the concession and production-sharing regimes, ownership rights to the petroleum, and allowing drillers to deduct their exploration expenses from tax payments and petroleum reserves.

Kurujit Nakornthap, deputy permanent secretary of the Energy Ministry, will lead the question-and-answer session on Friday. It will also invite Democrat Party leader Abhisit Vejjajiva and former foreign minister Prasong Soonsiri, who both oppose the petroleum concession bid, to the forum, as well as representatives of petroleum exploration and production companies such as Chevron, PTT Exploration and Production, Salamander and Mubala.

The National Reform Council and the National Legislative Assembly will also send observers.

An understanding was made with the petroleum companies that have prepared to join this round, including old-timers and newcomers, that the bidding extension followed the government’s policy to align the scheme to energy reform to ensure the stability and security of energy supplies based on correct information that will maximise benefits for the country and the people.

The department is positive it will meet its target to have bidders for more than 10 of the 29 blocks available in this round. One company has already submitted its bid.

"The department has insisted all along on the necessity of opening the petroleum concession auction to search for more reserves from what they are at present, which will be depleted in only seven years if there are no additional exploration and development of production fields," Puangthip said.

Including probable reserves that are defined as having a 50:50 chance of finding petroleum, Thailand will have enough for only another 13 years.

"If this round is not opened, it will affect not only investor confidence at large, but also our energy security, because we will have to import liquefied natural gas, which is more expensive than gas in the Gulf of Thailand, and that will lead to higher electricity tariffs," she said.

The department insists the bidding scheme is transparent and open to competition, she added.