Thailand to Award Petroleum Contracts to Three Consortiums

Oct 20, 2005 (Dow Jones Commodities News via Comtex) -- BANGKOK (Dow Jones)

Thailand's Department of Mineral Fuels said Tuesday it plans to award petroleum contracts for three offshore fields in the Gulf of Thailand to three consortiums.

The three consortiums are Unocal Andaman, which has proposed for Block G4/48; Unocal Andaman and PTTEP Siam, which together proposed for Block G9/48; and Thai Energy, Total E&P and PTTEP Siam, which have proposed for Block G12/48, said Krairit Nilkuha, the department's director-general.

The three consortiums have offered "attractive benefits" to the government in terms of technology transfer, training, community taxes, and employment of local staff, in addition to royalties and petroleum income taxes, Krairit said.

The list of bidders will likely be submitted to the cabinet by end-October for final approval.

The winning bidders will be given a nine-year exploration concession. If petroleum is discovered, the companies will apply for production rights, which are valid for 20-30 years. Companies are charged a royalty of 5% to 15% depending on production rates, while 50% of their net profit will be paid as petroleum income tax.

Nine consortiums submitted bids in the country's latest petroleum concession bidding round for 11 oil and gas blocks, but the government hasn't reached a decision for the remaining 8 blocks.

The Thai government is offering a total of 82 offshore and onshore blocks spanning 440,704 square kilometers across Thailand and its offshore areas. Companies can submit their bids until end-June 2006.

Copyright (c) 2005 Dow Jones & Company, Inc.

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