BEIJING Sep 20, 2006 (Dow Jones Newswires)
The chief executive of Australian oil and gas firm Horizon Oil Ltd. (HZN.AU) expressed concern Wednesday that a military coup in Thailand could delay the award of an offshore exploration block in the kingdom.
Brent Emmett said the Thai government of caretaker Prime Minister Thaksin Shinawatra had been due to ratify the award of the G10/48 block to Horizon and its exploration partners soon when it was ousted overnight.
Horizon was set for a 25% stake in the G10/48 block that covers 18,780 square kilometers, with Pearl Energy Ltd. taking 50% and Tana Exploration Co. LLC holding the remaining 25% interest.
The three-way consortium had also lodged a bid on the adjacent G11/48 block covering 13,600 square kilometers put up in the 2005 Thai open acreage bid round, while Emmett said Horizon was also looking at a third block.
"We have bid with others on a block in the Gulf of Thailand and we understand that we are going to be awarded that block subject to ratification by the government," Emmett told Dow Jones Newswires in an interview.
"With what's going on in Thailand as we speak, I can expect some delays on that process."
But "we're confident that we are going to get that (block)," he added.
Thailand was identified by Sydney-based Horizon as a focus area for new business along with China, where Horizon has a 30% stake in the 22/12 block in the Beibu Gulf off the south coast and an undrilled block in the nearby Lei Dong basin.
At the end of July, Horizon said the Gulf of Thailand was attractive because it was a prolific oil and gas producing province, but had been only sparsely explored and with dated technology.
There was a strong local market for oil and natural gas, while the region offered abundant oil field services, supplies and fabrication capability.
The G10/48 block is located south of the large Pailin and Bongkot gas trend in the Gulf of Thailand, while the G11/48 block is to the west.
"(The coup) is a concern but I don't think it's a show-stopper," Emmett said.
"I think the Thais are pragmatic people. I don't expect oil and gas operations to cease because there's been a coup."
"Life will go on, especially in those essential businesses. The Thais are importing 400,000 barrels of oil a day so they are not just going to stop work."
In addition to Thailand and China, Horizon has operations in New Zealand, Papua New Guinea and the U.S.
Copyright (c) 2006 Dow Jones & Company, Inc.
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