CHEVRON THAILAND Holdings Ltd, PTT Exploration and Production Plc (PTTEP) and PTTEP Energy Development competed yesterday in an auction for the Erawan and Bongkot petroleum fields.
Meanwhile, a citizen’s group is demanding a halt to the auction until proper negotiation takes place.
Representatives of the companies submitted their auction documents to the Department of Natural Fuels before the deadline, including their planned objectives, an investment budget, technical specifications, and benefits for the government in accordance with the terms of reference (TOR).
Chevron Thailand Holdings Ltd, in partnership with Mitsui Oil Exploration Co Ltd, and PTTEP Energy Development Co Ltd in partnership with M2 G2 (Thailand) Ltd handed in required documents yesterday for the G1/61 field. For the G2/61 field, Chevron Thailand Holdings Ltd, in partnership with Mitsui Oil Exploration Co Ltd, will be bidding against PTTEP Energy Development Co Ltd alone.
“Chevron is auctioning for both G1 and G2 fields because we believe in our capabilities in the region”, said Pairoj Kaweeyanun, president, Chevron Thailand.
“We believe our proposals are attractive for the government, and that through it, we have demonstrated our technological capabilities as well as expertise in the region,” he said.
Somporn Vongvuthipornchai, chief executive officer of PTTEP, said his company has submitted bid proposals for the two expiring concessions. PTTEP will bid solely on Bongkot, while for the Erawan gas block they will partner with Mubadala Petroleum (Thailand) Ltd, which also operates an oil and gas field in the Gulf of Thailand.
Continuity in Supply
“Our expertise and experiences in the exploration, development and production for 25 years in the Bongkot field have positioned us as a prudent and strong operator,” said Somporn. “We will ensure continuity in the natural gas supply with competitive costs, resulting in maximising benefits to the country and creating energy security in the long term.”
The Bongkot and Erawan gas fields are considered vital indigenous sources of Thailand’s energy supply, with a combined natural gas production accounting for 60 per cent of the country’s total output, he said.
The National Energy Policy Committee kicked off the auction for Erawan and Bongkot petroleum fields on the instructions of the Department of Mineral Fuels under the Ministry of Energy. With the current licences for the field due to expire in 2022 and 2023, the Ministry of Energy on April 24 invited interested parties to apply for the auction.
The Department of Mineral Fuels began on June 1 to accept auction entry forms from companies that satisfied its qualification evaluation, says Sarawut Kaewtathip, the department’s deputy director-general. The initial qualification evaluation for the field G1/61 gave the nod to Chevron Thailand Holdings Ltd, PTTEP Energy Development Co Ltd, Total E&P Thailand and MP G2 (Thailand) Ltd to proceed to the next stage. Meanwhile, bidding applications for the field G2/61 were opened to Chevron Thailand Holdings Ltd, PTTEP Energy Development Co Ltd and MP L21 (Thailand) Ltd.
Prime Minister Prayut Chan-o-cha has made it publicly known that the government aims to increase its financial benefits from auctioning these two fields.
It takes five years to draft investment plans and to transfer equipment from the previous operator to the new operator, General Prayut noted yesterday after a Cabinet meeting at Government House.
The government is doing its best to understand the various issues surrounding the auction process, he said. It asks the public to carefully evaluate which of their demands are achievable and which are not, he added.
The most worrying issue is the reduction of gas and oil yields, which will impact the manufacturing industry. What the government has to do now is to try to increase public financial privileges while also maintaining oil prices at a level acceptable to the public. The latter was a key issue discussed during the Cabinet meeting, he says.
The Erawan and Bongkot petroleum fields make up 70 per cent of the country’s entire natural gas deposit, holding up to 278 oil rigs, says Siri Jirapongphan, minister of energy.
Meanwhile, representatives of the Citizen’s Protection of Thailand’s Energy Network yesterday converged on the Ministry of Energy to protest the auction for Erawan and Bongkot fields. They call for the ministry to delay the auction by three months in order to establish a board of committee to jointly investigate the matter. Protesters are insisting on standing their ground in front of the ministry until a “proper negotiation” takes place.