PM: Petroleum concessions necessary

PM: Petroleum concessions necessary

Prime Minister Prayut Chan-o-cha has insisted that new bids for petroleum exploration concessions must go ahead or the country's energy resources will be used up in four years.

He was responding to calls by activists for a halt to the planned 21st round of concession auctions, announced in the Royal Gazette on Tuesday. They fear resources will be sold off to foreign investors without Thailand receiving a fair return.

The auctions are for 29 fields in the North and central regions (six fields totalling 5,459 square kilometres), the Northeast (17 fields covering 49,196 sq km) and the Gulf of Thailand (six fields for 11,808 sq km).

"Actually, these are expiring concessions. We need to renew them so the concessionaries can invest more and continue exploring," Gen Prayut said in his weekly television address on Friday. "No one will pour his money into a project with a remaining life of just one year.

"They have risks too because so far very little gas and oil has been found."

Thailand has a small quantity of oil and its existing natural gas fields will be exhausted in 2018, he said.

However, according to the US Energy Information Administration (EIA), Thailand has about 9 trillion cubic feet of proved natural gas reserves. The Energy Ministry has said it expects gas production to peak in 2017 and supplies to be depleted by 2030 at current production levels and with no reserve additions.

"If we stop exploring now, all of the gas used in the country will have to be imported. Negotiating terms for the concessions is another issue," the premier added.

At least two non-government organisations have threatened to file lawsuits against authorities and to protest against the auctions.

They argue that the exploration and production concessions put the country at a disadvantage. Authorities counter that the tax and royalty regimes have been revised with rates higher than what many governments receive.

Opponents suggest the country adopt what they claim is a production sharing method used by neighbouring countries, or Asean standards. It is not clear what these standards are.

Gen Prayut also warned it was high time Thailand bit the bullet and paid the actual costs for energy.

He cited LPG as an example, saying the subsidy was as high as 6-7 baht a litre.

"Governments shoulder this cost to cushion the impact on people but another problem arises: what do we do if the [world] price keeps rising?

"Besides, we can't encourage people to save energy if the real prices do not register.

"The difference between local and world prices also inevitably leads to smuggling. So in the end, we end up footing the bills for our neighbours too."

In the fast lane

In order to help save energy, the premier said the Transport Ministry would speed up construction of four mass-transit rail lines in Bangkok and vicinity.

The Purple Line (Bang Yai-Bang Sue) will be completed by 2017. The Blue Line (Bang Sue-Tha Phra-Hua Lamphong-Bang Kae) and the Red Line (Bang Sue-Rangsit) will be finished two years later while the Green Line extension (Bearing-Samut Prakan) will be done in 2020.

Studies and bidding for another seven lines will also be accelerated so that construction can be completed by 2021.

"I also asked the ministry to make the lines link with communities so low-income earners can benefit from them," he added.

Going nano

Gen Prayut also used his Friday address to tell the public that economic ministers were considering "nanofinance" to give poor people access to funds.

The National Legislative Assembly is currently considering a debt-repayment enforcement act that would require debt collectors to be registered with the Finance Ministry.

"If you [repayment enforcers] threaten or use violence on debtors, demand repayments at night or workplaces or from relatives, the highest penalty is imprisonment," Gen Prayut said.

"Please empathise with and try to understand poor people. Don't just do everything for your own end.

"There're a number of laws on debt-repayment enforcement and they will be enforced more strictly."

The problems experienced by debtors have been the focus of attention since a heavily indebted woman from Lop Buri set herself on fire at Government House two weeks ago. She remains in critical condition in hospital.

Sangvean Raksaphet, 52, had gone to a people's service centre to file a complaint over a 1.5-million-baht debt, claiming she was the victim of a loan shark who had cheated her.

The government is helping her with the debt, but it remains unclear whether her account is true after a woman claiming to be the creditor's relative denied the accusation.

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