Contributed By Chandler MHM Limited
There is no provincial/state, local or private ownership of petroleum, with Section 23 of the Petroleum Act (PA) stating: “All Petroleum belongs to the State.”
One of the best sources of information about the petroleum industry is the Petroleum Institute of Thailand (PTIT), a foundation whose members are concessionaires and service companies (http://www.ptit.org/index.php/About/About-PTIT). It publishes the PTIT Focus ten months of the year, which includes current statistics on petroleum and petrochemical, and Thailand’s petroleum balance (imports and exports).
Another good source is the Annual Report of the Department of Mineral Fuels, Ministry of Energy (latest issue 2016), which provides a very transparent report on the status of petroleum concessions and all State revenues paid by concessionaires.
Most of this guide concerns terms of petroleum concessions for which there have been 20 bid rounds since 1971. The first bid round for PSCs is currently underway.
See MoE Announcement Re: Rules procedures and conditions in the application and award of the rights to be a production sharing contractor for Exploration Block Nos. G1/61 (Erawan Field) and G2/61 (Bongkot) in the Gulf of Thailand, dated 24 April 2018. The Bod Documents were available on the DMF website on 25 April 2018. The deadline for submission of proposals by pre-qualified bidders is 28 September 2018.
The following regulatory bodies have branches in certain provinces:
– administers the Petroleum Income Tax Act (PITA), through the Revenue Department.
Energy Regulatory Commission (ERC) http://www.erc.or.th/ERCWeb2/EN/
In the past, the management of Thailand’s energy sector was under the National Energy Policy Council Act, B.E. 2535 (1992), whereby the National Energy Policy Council (NEPC) was empowered to set the national energy policy and the national energy management and development plan, and to monitor and supervise energy-related operations.
The Energy Industry Act, B.E. 2550 (2007) (the Act) came into effect on 11 December 2007, with the aim of restructuring the management of the energy industry.
It separates the functions of policy-making, regulation and operation from one another, with the purpose of achieving efficient, secure, adequate and extensive energy service provision with reasonable prices and up-to-standard quality, in order to meet demand and contribute to the sustainable development of Thailand in social, economic and environmental terms. The Act also aims to promote competition and enhance greater participation in the energy industry among the private sector, communities and the general public.
The Energy Regulatory Commission (ERC) was established under the Act to regulate energy industry operations – which means the electricity industry, the natural gas industry and the energy network industry – in order to ensure compliance with the objectives of the Act under the policy framework of the government. The Office of the Energy Regulatory Commission (OERC) was also established under the Act as a state agency to function as the Secretariat to support the work of the ERC.
After the establishment of the ERC, the government, via the NEPC, has the authority and duty to determine policies on energy industry management, while the ERC has the authority and duty to regulate energy industry operations in compliance with the policy framework of the government. The ERC is empowered to issue regulations, rules, announcements or criteria, procedures and conditions in order to regulate various issues in the energy industry as prescribed by law, with examples including:
Prior to issuing any ERC regulations, rules and announcements that will affect persons, groups of persons or licensees, a hearing process must be arranged. In addition, the ERC is tasked with the promotion of renewable energy and the efficient use of energy.
PTT Public Company Limited (PTT) http://www.pttplc.com/en/Pages/Home.aspx
Petroleum Authority of Thailand was established on 29 December 1978 and commenced its primary mission of expediting the procurement of adequate oil for domestic consumption. There was a drive for PTT to seek additional indigenous petroleum reservoirs for the benefit of the country.
Following the privatisation of the state enterprise, PTT Public Company Limited (PTT) was registered on 1 October 2001, and inherited from its predecessor all business operations, rights, debts, liabilities, assets and personnel.
PTT had an initial registered capital of THB20,000 million (10 Baht/share) and was listed on the Stock Exchange of Thailand, with the Ministry of Finance as the largest shareholder.
PTT Exploration and Production Public Company Limited (PTTEP) https://www.pttep.com/en/home.aspx
This is PTT’s exploration and production company, and currently has projects in eight countries besides Thailand.
Other PTT affiliated companies:
The 2017 amendments to the PA and PITA introduced production sharing contract (PSC) and service contract (SC) regimes, in addition to petroleum concessions. These changes created major challenges for both the regulators and O&G companies.
In 1971, Thailand promulgated the original Petroleum Act (PA) and the Petroleum Income Tax Act (PITA). The PA established a concession system based on the Consideration Bases, and nine Ministerial Regulations were issued in 1971 dealing with major subjects under that act. The PITA established an income tax system that was applicable only to concessionaires, with tax rates between 50% and 60%. A tax rate of 50% was prescribed by a Royal Decree. Three Ministerial Regulations were issued in 1971 under the PITA.
The Petroleum Act (No. 7) and the Petroleum Income Tax Act (No. 7) were enacted in March 2017 to establish the PSC and SC contract regimes.Amendments to Section 23 of the PA include the addition that the exploration and production of petroleum now require the grant of a PSC, SC or concession. The Ministry of Energy has the authority to determine which form is appropriate, with rules and procedures to be published with the approval of the Council of Ministers.
Amendments to the PA in regard to PSCs include general terms and conditions that are to be included in the contract. Significant features of such contracts include the following:
Amendments to the PA in regard to SCs also include general terms and conditions that are to be included in such contracts. Significant features of such contracts include the following:
For the adoption of the PSC form, the PITA has likewise been amended. Under its Section 65 quatervicies, a company that is a party to a PSC must pay income tax of 20% of the net profits from the petroleum business. The PITA does not mention SCs. Thus, a party to such a contract is subject to the general income tax under the Revenue Code of 20%.
The Thai petroleum concession has provided a very stable foundation for investment in the oil and gas industry since 1971, but Thailand has limited geological prospectivity for oil and gas. It currently imports more than 40% of its natural gas requirements and approximately 70% of its crude oil requirements, and its petroleum reserves are declining with increasing demand.
The 2017 amendments to the PA and the PITA added PSCs and SCs to concessions. It remains to be seen how these new contract regimes will be implemented and administered, and whether the oil & gas industry will accept their proposed new terms. The PSC cost recovery limit of 50% and the 50% minimum governmental share of the “profit oil” may not be economically viable with low oil prices and geological prospectivity.
The PA could have simply been amended to allow second and subsequent extensions of existing concessions. This is the practice in many other jurisdictions, in which subsequent extensions are negotiated and granted, often on improved terms for the host government.
Related Legislation and Announcements
DMF Notifications and Announcements
Petroleum Income Tax Act
Please note that the above list does not include all legislation applicable to concessionaires and petroleum service companies. See, for example, the Foreign Business Operation Act, the Civil Aviation Act, the Construction Professions Act, the Customs Act, the Explosives Act, the Forestry Legislation, the Immigration Act, the Working of Aliens Law, the Vessels Act, etc.
Until 2018, the method by which private investors could obtain the right to explore for, develop and produce petroleum was to apply for a petroleum concession. Although not expressly required by law, the Thai practice has been to award concessions only following the publication of an international invitation, usually on at least 45 days’ notice. Applications were evaluated on a points system by the Petroleum Committee, which forwards its recommendations to the Cabinet for approval. Approval of the Cabinet is also specifically required for international dispute resolution by arbitration. There have been 20 rounds to date, with the 21st round having been cancelled. The latest form of petroleum concession is prescribed in MR No. 24, dated 29 June 2012.
Most concession terms and conditions are prescribed in the PA and its regulations. In practice, concession applicants were rarely permitted to negotiate changes to the standard terms.
In 2016 there were 38 concessions covering 45 exploration blocks: 20 offshore concessions covering 24 exploration blocks in the Gulf of Thailand, and 18 onshore concessions covering 21 exploration blocks.
Following amendments to the PA and PITA in 2017, the government may award production sharing contracts and risk service contracts in addition to petroleum concessions.
Only one tender has been announced since the 2017 amendments to the PA and PITA, for the expiring Erawan and Bongkot concessions. The tender offers PSCs for Block Nos. G1 for the Erawan Field and G2 for the Bongkot Field were announced on 24 April 2018 and pose a number of major issues, as follows:
Based on past practice, the MoE issues an announcement inviting tenders, with 45 days' notice or more, specifying conditions that apply to the round of bidding.
Prerequisite qualifications are prescribed in Section 24 of the PA, which states that an applicant must “Be a company or companies, and have capital, machinery, equipment, tools and specialists to such extent that it is capable to explore for, produce, sell and dispose of petroleum.”
An applicant that does not meet all these requirments must have a guarantee from a qualified company with a connection to capital or management of the applicant, usually a parent company.
The announcement of the 21st bid round on 21 October 2014 (subsequently cancelled) provides additional conditions of bidding, which may be followed in the future. That bid round set forth the following rules, procedures and conditions:
Production sharing contracts:
Risk sharing contracts:
Petroleum Concessions: 50% plus SRB (Special Remuneration Benefit), a unique form of excess profits tax.
Production sharing contracts: 20%.
Risk sharing contracts: 20%.
There are no income tax incentives, but there are custom duty and VAT exemptions on imports.
No special rights are given to PTTEP or other majority State-owned oil & gas exploration companies.
The conditions of bidding invite bidders to provide “special benefits”, including conditions for the use of local goods and services, training programmes, production bonuses, etc. See 2.2 Issuing Upstream Licences.
A production area must be defined in accordance with a ministerial regulation (MR), as per Section 42 of the PA.
See MR prescribing rules and procedures for petroleum exploration, production and preservation B.E. 2555 (2012).
The concessionaire must submit production plans and reports, and must obtain government approval of any amendments to said plans. There is an obligation to produce within four years, with possible deferrals of two years each.
Outline of Thailand III Terms
21st bid round, based on an Announcement of the Ministry of Energy, dated 21 October 2014
This bid round was postponed, then cancelled in March 2015. The prime minister ordered delays, to allow certain blocks to be granted under PSCs. However, many of the terms of the 21st bid round are likely to be followed in future bid rounds for concessions, PSCs and SCs.
Nature of rights: concession agreement signed with the Ministry of Energy on 1 October 2002 (formerly the Ministry of Industry).
Management responsibility: lies with the company, subject to plans approved by the Department of Mineral Fuels (formerly the DMR).
Eligibility: the concessionaire must be a foreign or Thai limited company.
Area of blocks: ceilings on the number and area of blocks were deleted by PA (No. 6). Special concessions not exceeding 200 sq km, with relaxed royalty rates, may be issued for high-cost onshore fields.
Reserved exploration area: 12.5% of initial area, up to five years after the end of the exploration period.
Application fee of THB10,000.
THB3 million bid security per block (cashier check, Thai Government bond or Letter of Guarantee).
Work expenditure is fixed for each of the first three years and, later, for each of the second three years. Excess may be carried forward. Modification is possible with the consent of the Minister. A performance bond is required in an amount not less than the minimum expenditure obligation of the First Obligation Period (Thai Government bond or bank guarantee).
“Special benefits” – there are special payments/advantages, in addition to the payment of royalty, income tax and SRB, throughout the exploration and production periods. For each exploration block, the special payments/advantages must include the following as a minimum:
Royalty is imposed at the following progressive rates:
In deep water blocks, the royalty is 70% of the above rates. The government has the authority to fix lower rates in special situations.
Royalty in cash is based on the posted, realised or market price, and is payable monthly. Royalty in kind is in a volume equivalent in value to the royalty paid in cash. Royalty disputes are to be settled by the court, not international arbitration.
Income tax is 50% on profits (or 35% on profits plus 23.08% remittance tax, under Royal Decree), and is payable semi-annually.
Revenues, deductions and taxes for all “Thailand III” blocks of the same concessionaire may be consolidated. Other blocks of the same concessionaire must be consolidated separately.
Capital costs are generally amortised over five to ten years (accelerated depreciation permitted).
Operating costs, royalties and SRB are expensed.
Revenues on crude oil sales are based on a realised price or, for exports, on the higher of realised or “tax reference” price, with the latter being the posted price with a discount.There is a ten-year loss carry forward, but no loss carryback.
SRB is a “windfall profits” tax, payable only in years when the concessionaire has “petroleum profit”. In calculating such petroleum profit for the year, there may be deducted capital expenditure, operating costs, a special reduction (an expense “uplift”) for the year, and petroleum loss carried forward from prior years. SRB is calculated by exploration block at the following rates, subject to a ceiling of 75% of the petroleum profit:
Income per metre of wellSRB
To determine the “income per metre of well”, first the annual petroleum profit is calculated and adjusted for inflation and exchange rates, then the accumulated total metres of all wells drilled during the concession period is calculated. Income per metre of well equals the adjusted annual petroleum profit divided by the total depth of all wells + GSF. “GSF” stands for “geological stability factor”, which is fixed for each geological region and is at least 150,000 metres, or higher in difficult drilling areas.
Crude oil – export sales on f.o.b. posted price fixed by the concessionaire and agreed by the government. In the absence of regular exports, domestic sales are at a price not exceeding that of imported crude oil; otherwise, they are on the average realised price of exports by all concessionaires.
Natural gas – pricing is negotiable, but the sole purchaser is PTT.
Disposition of crude oil
Local market supply – the government may require a supply to the local market at domestic sales prices. First priority must be given to government at a domestic oil refinery.
Exports may be subject to bans or restrictions under PA Section 61. Recently, the MoE issued a letter seeking co-operation from all concessionaires not to export any crude oil. A concessionaire can request approval to export crude oil on a case-by-case basis.
Disposition of natural gas
In practice, natural gas must be sold to PTT at a negotiated price, as it has a de facto monopoly on the internal transportation of natural gas.
Thai law is the governing law, taking the principles of international law into account.
Disputes must be settled in Bangkok, unless otherwise agreed. Royalty disputes are to be settled by a Thai court. Since 1 August 2012, arbitration shall be conducted according to UNCITRAL Arbitration Rules, with an appointing authority to be agreed.
The qualifications of affiliated company transferees are now to be scrutinised.
The confidentiality period for reports submitted by the concessionaire ends one year after the date of receipt.
Application to prior concessions
This can occur upon application and consent if the concessionaire is not yet in production.
Outline of 2018 auction of Erawan and Bongkot Fields
The Bid Documents for Thailand Round 2018 for Blocks G1/61 and G2/61 (each 81 pages), provides details of the first bid round for PSC’s. www.dmf.go.th/bidding2018 The deadline for submission of proposals is 28 September 2018. Announcement of successful bidder(s) (subject to Cabinet approval) is expected prior to the end of 2018, and signing of PSC’s within February 2019.
Following the award of PSC’s for Erawan and Bongkot Fields, the government contemplates inviting bids of a number of onshore and offshore blocks.
Sections 47, 48 and 50 of the PA apply.
A concessionaire may allow other companies to co-venture in the concession if permission is obtained from the Minister of MOE. Each co-venturer pays royalty, income tax and other sums due under the PA.
Transfers of concessions and changes of operators between affiliated companies are governed under Section 48 of the PA.
Section 50 of the PA governs transfers to third parties and changes of operator, and generally requires the approval of the Minister of MOE after obtaining approval from the Petroleum Committee. Transferees must possess all qualifications under the PA.
Transfers of interests in a petroleum concession may trigger income tax liabilities under the PITA.
PTT has an unwritten monopoly to purchase domestic natural gas, and to build and operate transmission pipelines.
Private investment is allowed in all other downstream business. There is no standard form of regulatory licence.
There is currently no third-party access to natural gas pipelines, although proposals to introduce third-party access have frequently been made in the past.
PTT conducts solicitations (bid rounds) for the sale of gas to power plants and other industries requiring gas. The purchase of crude oil and condensation is subject to negotiation with individual refineries and other users.
There are seven oil refineries in Thailand:
Thai Oil Public Company Limited
Thai Oil Public Company Limited – or simply Thaioil – is a Thai public company, listed on the Stock Exchange of Thailand (SET). It is a subsidiary of PTT Group and was founded on 3 August 1961.
With almost half a century of continued development, Thaioil is the largest refinery in Thailand and can produce a variety of products, including petroleum, petrochemical products and lube base oil. It has gone from a small 35,000 bbl/d refinery to a 275,000 bbl/d single-site refinery.
IRPC Public Company Limited or IRPC (formerly Thai Petrochemical Industry Public Company Limited, or “TPI”) was registered in 1978 by the Leophairatana family. TPI was transformed into a public company on 10 October 1994 and listed on the SET on 17 March 1995. IRPC started to produce petroleum and petrochemical products in 1982, and expanded its line of production of various petrochemical products. It expanded the plant and infrastructure into a fully integrated petrochemical complex.
IRPC suffered from the financial crisis in 1997 and entered a rehabilitation process in 2000. The rehabilitation was successful and ended on 26 April 2006.
IRPC and its subsidiaries are the first fully integrated petrochemical complex in Southeast Asia. IRPC's plants are located in an industrial area in Rayong Province with facilities to support the businesses, such as a deep sea port, a tank farm and a power plant.
PTT Global Chemical Public Company Limited (GC) is a subsidiary of PTT Public Company Limited. It was founded on 19 October 2011 through the amalgamation of PTT Chemical Public Company Limited and PTT Aromatics and Refining Public Company Limited to be the chemical flagship of PTT Group.
PTTGC is Thailand's largest petrochemical and refining company, with a capacity of producing 280,000 barrels of crude oil and condensate daily, and 8.75 million tons of olefins and aromatics annually. Since the merger, PTTGC benefits from reduced manufacturing cost due to the large volumes and reduced overhead cost by delivering value-added products within the downstream specialties sector under the same management umbrella.
PTTGC was listed in the Top 10 of the Dow Jones Sustainability Indices (DJSI) for two consecutive years and was ranked 22nd among the world-leading petrochemical companies on the ICIS Top 100 Chemical Companies listing. The company has seven main business lines. It focuses on investing into the expansion of speciality chemical products and green chemicals.
PTTGC also owns and operates production support facilities, such as jetty and buffer tank farm services for liquid chemical, oil and gas. Minor activities are the production and distribution of electricity, water, steam and other utilities.
Bangchak Petroleum PLC was established in 1984 to engage in the petroleum business.
To grow its business base in 2014, Bangchak moved into the petroleum exploration and production (E&P) business.
The company’s refinery complex produces gasoline and diesel products. Its gasoline, gasohol and diesel all meet the EURO IV quality specifications. Bangchak was the first Asian company to come up with EURO 5-standard E20 gasohol with less than 10 ppm in sulphur content, a five-fold reduction from that under the EURO 4 standard. In addition, the refinery is highly energy-efficient, due to the purchase of power and steam from a cogeneration power plant and the use of natural gas in place of fuel oil.
Located at Laem Chabang, Sriracha district, Chon Buri province, the complex Esso Sriracha Refinery has been a domestic energy source since 1967.
The refinery has a maximum rated capacity of 174,000 barrels per day, with more than 100 crude and finished oil tanks, a jetty off the coast to handle oil tankers of up to 120,000 tons, and three jetties to deliver up to 8,000 tons of oil and chemical products.
The refinery configuration incorporates ExxonMobil’s unique proprietary technologies, which provide significant flexibility to handle a wide range of crude oils and to produce a high proportion of high-value products, such as gasoline, diesel and jet fuel.
In 1999, an aromatics plant with a capacity of 500,000 tons per year was established and fully integrated with the refinery operations, employing world-class technology and producing aromatics primarily in the form of paraxylene, which is used to make purified terephthalic acid (PTA), the raw material for producing polyester film, packaging resin and fabrics. Other chemical products include solvents and plasticisers.
RPCG Public Company Limited, formerly known as Rayong Purifier Public Company Limited, was established in 1995 by a joint venture between Thai businessmen with extensive experience in the petroleum and petrochemical businesses and Petro-Instruments Co., Ltd. The company's main business is to refine Condensate Residual (CR), which is a byproduct from the production process of PTT Global Chemical Public Company Limited (PTTGC) (formerly known as PTT Aromatics and Refining Public Company Limited (PTTAR)), into high-quality petroleum and petrochemical products, such as high-speed diesel oil, fuel oil and petrochemical products, for the wholesale and retail market. In addition, the company has a fuel-trading licence, under Article 7 of the Fuel Trade Act, B.E. 2543 (2000).
Star Petroleum Refining Company Limited was established in 1992, with Chevron South Asia Holdings Pte. Ltd. and PTT Public Company Limited owning 64% and 36% of the share capital, respectively.
SPRC commenced operations in 1996 with a design capacity of 130,000 barrels per day. It successfully debottlenecked the Crude Distillation Unit and the Vacuum Distillation Unit, effectively increasing the capacity from 130,000 to 155,000 barrels per day.
In 2012, SPRC converted to a PCL under the name Star Petroleum Refining Public Company Limited. In 2015, it was listed on the Stock Exchange of Thailand. SPRC is majority-owned by Chevron (60.6%), PTT PLC (5.4%) and public shareholders (34.0%).
Thailand – Gas Separation Plants
There are six gas separation plants in Thailand:
PTT Gas Separation Plant (www.pttplc.com) is the largest gas separation operator in Thailand. It runs six gas separation plants to separate various hydrocarbons from the natural gas which, in turn, maximises the value of the gas from the Gulf of Thailand.
Gas Separation Plant Units 1-3, 5 and 6 are located in Tambon (Sub-district) Mab Ta Phut, Amphur (District) Mueng, Rayong Province; the fourth Unit is in Amphur Khanom, Nakhon Sri Thammarat Province.
Presently, PTT’s gas separation plants have a processing capacity of 2,820 million cubic feet per day (MMSCFD). The First Unit’s capacity is 400 MMSCFD; the Second and Third Units (including increment from the ethane separation plant) have a capacity of 800 MMSCFD.
The Fourth Unit’s capacity is 170 MMSCFD, while the Fifth and Sixth Units have a capacity of 570 and 880 MMSCFD, respectively.
Downstream projects are subject to the laws of general applicability, plus special permits, licences and government approvals applicable to specific products.
Most projects (both Thai and foreign owned) apply to the BOI or IEAT for promotion, and to obtain guaranties, tax holiday, customs duty exemptions, etc.
Downstream infrastructure is subject to the company income tax (currently 20%). Projects that are promoted by the Board of Investment (BOI) under the Investment Promotion Act (1977), or by the Industrial Estate Authority of Thailand under the Industrial Estate Authority Act (1979), may be granted a number of tax and non-tax incentives.
See the 106-page “A Guide to the Board of Investment 2017”, which is on the BOI website.
In May 2018, the Eastern Special Development Zone Act (EEC Act) was enacted, which complements the BOI regime and provides additional incentives for investors in Special Economic Zones (SEZs) prescribed under the Act (https://www.eeco.or.th/en/background).
There is no general local content requirement.
There is no equivalent of a single downstream licence. Downstream projects are subject to the laws and regulations that are applicable to all industries, and to the specific laws that are applicable to the particular products.
A private investor constructing infrastructure does not have any condemnation or eminent domain rights.
Currently, there are no open access rights or third-party rights, except in special cases, such as access to the grid by producers of electricity.
Each sector is subject to licences, permits, standards, etc. Foreigners are subject to a number of restrictions under 17 laws and policies, a number of which are waived or exempted by the BOI, IEAT or EEC office.
Generally, there are no downstream licences. Assignments of rights to carry on business are subject to the applicable laws and policies, and to the consent of regulators, lenders, BOI or IEAT, etc.
Petroleum concessions include contract stability provisions in Clause 12.
The model form of the PSC includes similar provisions in Clause 12.
Contract disputes are subject to arbitration under the UNCITRAL Rules, with the venue being Bangkok.
Upstream investments are not eligible for promotion under the Investment Promotion Act.
Concessionaires are subject to the following labour and environmental legislation of general application:
The Labour Protection Act of 1998, as amended in 2008, is administered by the Ministry of Labour and Welfare and applies to any employer with ten or more employees. The labour inspection officer appointed by the minister enforces the act, which covers all general employment practices, including the terms and conditions of employment, occupational safety and health, and environmental conditions. Non-compliance with the act may result in fines of THB2,000 or one month’s imprisonment, or both.
Under the Environmental Act, the Ministry of Natural Resources and Environment, in conjunction with the National Environment Board, prescribes which categories of industrial projects are subject to regulation and approval by the Office of Natural Resources and Environmental Policy and Planning. An environmental impact assessment report must be filed before approval for a regulated industrial project can be granted.
The Fuel Oil Trading Act is administered by the Department of Energy Business, which is a subdivision of the Ministry of Energy (MoE). It requires oil traders who trade 100,000 metric tonnes of oil (or 50,000 metric tonnes of liquefied natural gas) or more each year to obtain a licence from the MoE and to keep records regarding the purchase, refining, production and disposal of fuel oil. Penalties under the act include licence revocation, imprisonment and fines.
Upstream projects: see the MR prescribing rules and procedures for petroleum exploration, production and preservation (29 June 2012).
Downstream projects: generally, an EIA report is required to be approved by the Office of NREPP.
See 5.1 Principal Environmental Laws and Environmental Regulator(s).
See the MR prescribing rules and procedures for petroleum exploration, production and preservation (29 June 2012).
See the MR prescribing safety zone and signs in areas where there are installed structured and mechanical equipment for petroleum exploration and production (29 June 2012).
During the 4th Petroleum Forum, an overview of pending legislation was provided for Thailand’s decommissioning guidelines. Along with related government agencies, petroleum operators and the PTIT, the DMF formed a Decommissioning Task Force to develop the Thailand Decommissioning Guidelines of Upstream Installations. The requirements presented involve a four-stage Decommissioning Environmental Management Plan, as follows, with all stages requiring consultation and approval by the DMF:
The Decommissioning Ministerial Regulation was issued on 29 January 2016. It provides a framework for addressing some issues, but others remain unresolved.
Decommissioning has generally not been addressed in detail until recently, in connection with the expiring Erawan and Bongkot concessions. The Bid Documents contemplate the settlement of decommissioning obligations as part of the transfer of concession areas to the State, and the transfer of possession to contractors under PSCs.
The Climate Change Coordinating Unit is within the Office of Natural Resources and Environment Policy and Planning (ONEP).
The Greenhouse Gas Management Organisation (TGO) was established in 2007 and functions as the Designated National Authority for CDM projects in Thailand.
As far as is known, there are no specific provisions relating to the oil and gas industry.
There is no legislation relating to the upstream development of unconventional upstream interests, including shale, heavy oil and coal-bed methane.
LNG projects are not covered by the PA or PITA.
The ERC and other policy bodies in the Thai government decide policy regrarding LNG projects.
Currently, the only importer of LNG is PTT LNG.
Policies to liberlise the sector from the current PTT monopoly on domestic transport and sale of LNG have been proposed.
There is the issue of the OCA (Overlapping Claims Area) between Cambodia and Thailand, which includes an area of 26,000 km in the Gulf of Thailand, with known petroleum resources.
There is also the issue of decommissioning see 5.4 Requirements for Decommissioning, above. Applicable legislation includes:
Please see 1.4 Principal Petroleum Law(s) and Regulations above regarding changes to oil and gas law.
Websites for current information concerning the energy sector include the following: