Dept sees hike in royalty fees on rising crude prices 

For the half of the year, it received Bt21.92 billion in royalty fees.
Veerasak Pungrassamee, director-general of the department, said that of the first-half collection in fees, Bt20.84 billion has been given to the Ministry of Finance as national revenue and the remaining Bt1.08 billion was allocated to local organisations.

Since the royalty fees were imposed in 1981 until June 2018, total operating income from petroleum operations in Thailand amounted to Bt2.14 trillion. The revenue streams came from the petroleum royalty fees, extraordinary gains, income from a Thailand-Malaysia joint organisation, and petroleum income tax, another other sources.
In regard to the royalty fees for onshore fields, the department has proposed cutting the contributions to the Provincial Administrative Organisations from 20 per cent to 10 per cent. It wants more to be given to Subdistrict Administrative Organisations (SAOs) in areas where the systems of energy infrastructure are located for greater community acceptance.
Currently, of the total collection of petroleum royalty fees, 20 per cent is given to local organisations including SAOs and municipalities in the petroleum concession areas, 10 per cent to SAOs and municipalities in provinces where petroleum production exists, 10 per cent to SAOs and municipalities in other provinces, and 20 per cent to Provincial Administrative Organisations. The remaining 40 per cent is handed over to the Finance Ministry as national revenue.
Veerasak said that Thailand’s demand for liquefied natural gas (LNG) is forecast to rise in replacement of natural gas in the Gulf of Thailand. After 2022-2023, the amount of natural gas is estimated to drop to about 1.5 billion cubic feet per day from the current figure of 3.8 billion cubic feet.

The National Energy Policy Council (NEPC) has mandated that the Electricity Generating Authority of Thailand (Egat) start importing a maximum of 1.5 million tonnes of LNG a year to the Terminal 1 extension - which has been constructed by PTT - in the Map Ta Phut area in 2019. Meanwhile, the gas price and the amount of imports have been under consideration.
“Imports of LNG by Egat should be done by separating the gas procurement system from the power procurement to determine criteria for cost calculation and type of gas procurement contract on whether it will be spot or long term for 10-20 years,” Veerasak said. The result will be finalised by the NEPC.
To handle arrangements with the gas contract in Myanmar, due to expire in 2027, the Ministry of Energy plans to upgrade the 3,600-megawatt Ratchaburi power plant - whose contract will expire in the same year - to be able to receive gas from the east instead.
In the first half of this year, petroleum production in Thailand edged up 0.5 per cent year on year to 830,161 barrels of oil equivalent. Of this increase, the natural gas output rose 3.1 per cent year on year to 3,470 million cubic feet per day and the LNG produced increased 3 per cent to 105,576 barrels. However, the production of crude oil fell 8.7 per cent year on year to 132,567 barrels per day.

The Ministry of Energy reportedly will propose that the NEPC review Egat’s plan this year for imports of 1.5 million tonnes of LNG per year on concern over the possible impacts on Thailand’s electricity costs from the to-be-imported gas price. It will consider the issue at a meeting on August 3.
The ministry will also seek approval of PTT’s long-term plan to procure 2.6 million tonnes of gas a year from the Mozambique Rovuma Offshore Area 1 Project. Meanwhile, the amount of gas will not be calculated in the Pool Gas system.
The progress on the electricity load forecast will also be reported in the NEPC meeting to enable the drafting of the Power Development Plan 2018. The initial details for the plan will be completed in September.