Thailand has enjoyed a relatively stable petroleum law
regime since 1971 when the Petroleum Act BE 2514, 1971 (PA) and
the Petroleum Income Tax Act BE 2514, 1971 (PITA) were enacted.
Thailand adopted a modern form of petroleum concession, which
has been updated from time to time. There have been 20 bid
rounds, the last in 2007. A number of commercial oil and gas
discoveries have been made, and as of 2017, there were 38
concessions in force. However, Thailand has limited geological
prospects for oil and gas, and it imports more than 40% of its
natural gas requirements.
Thailand imports natural gas from Myanmar (18% of demand),
the Thai-Malaysian Joint Development Area (JDA). State-owned
oil and gas company, PTT, which had a monopoly on the
distribution and sale of natural gas in Thailand, started
importing LNG in 2011. In 2017, 12% of natural gas demand was
met by LNG imports. In the past, PTT was (with few exceptions)
the purchaser of all natural gas, and it owns the pipeline
transportation system.
A 21st bid round was announced in 2014, but was cancelled in
2015 following a number of challenges by non-governmental
organisations, with others arguing that the concession was not
a favourable fiscal regime for the state.
In 2017, amendments to the PA and PITA were approved, which
provided for rights to explore, develop and produce petroleum
to be granted by way of concession agreement, production
sharing contract (PSC) and service contract (SC).
In December 2017, the Minister of Energy said that two
tenders would be conducted in 2018: the auctioning of the
Bangkot and Erawan gas blocks in the Gulf of Thailand, followed
by the 21st bid round for the rights to 22 blocks.
As of January 10 2018, the Department of Mineral Fuels had
not published forms of PSC or SC, nor any ministerial
regulations/notifications governing their application. It
remains uncertain how the new auctions will be managed, and
whether the oil and gas industry will agree to the proposed new
terms.
Additional pending issues include: (a) the resolution of
Thailand and Cambodia's overlapping claims area; and, (b) the
implementation of decommissioning, particularly of platforms
and wells in the Gulf of Thailand.
In January 2018, the Energy Minister announced the end of
the Electricty Generating Authority of Thailand's and PTT's
monopolies, and the deregulation of power generation. The Power
Development Plan is to be revised, with the amendments being
finalised by March 2018. The deregulation of LNG imports was
also announced.
The Petroleum Institute of Thailand (PTIT) is the best
source of information and statistics on the petroleum business
in Thailand.
The main regulators of the petroleum sector in Thailand
are:
- the Ministry of Energy, which establishes policies and
plans for the energy sector;
- the Energy Regulatory Commission;
- the Department of Mineral Fuels; and
- the Department of Alternative Energy Development and
Efficiency.
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| Ratana Poonsombudlert |
Albert T. Chandler |
Sawanee Gulthawatvichai |