Energy policymakers plan to have two liquefied natural gas (LNG) receiving terminals in Rayong supply gas to power plants instead of the offshore Erawan gas field in the Gulf of Thailand, which may not begin operation in 2022 under its new operator, PTT Exploration and Production Plc (PTTEP).
The likely delay is attributed to a legal dispute, said Energy Minister Supattanapong Punmeechaow.
The Erawan field is operated by US-based Chevron Corp, whose concession expires in two years. Transferable assets need to be decommissioned, but it is in dispute over who will pay: Chevron or the Department of Mineral Fuels.
If the problem is prolonged and affects gas production, officials plan to use parts of LNG capacities at Map Ta Phut and Nong Fab, which belong to national oil and gas conglomerate PTT, in Rayong to avoid any shortfall.
"Energy agencies and firms in the gas field are bracing for this scenario if the dispute cannot be settled by April 2022," Mr Supattanapong said.
Gas production capacity at Erawan stands at 1,240 million standard cubic feet per day, or 30% of total gas supply for the first half this year.
The regasification facility at Map Ta Phut has an annual capacity of 11.5 million tonnes.
One million tonnes of LPG can be turned to gas, amounting to 140 million standard cubic feet per day.
Last year only 5 million tonnes of capacity at Map Ta Phut was used, making it possible for authorities to use the remainder if gas production at Erawan faces a problem.
PTT also owns the Nong Fab facility, with a capacity of 7.5 million tonnes. It is scheduled to start operation in 2022.
Chevron saw PTTEP, which operates Bongkot gas block in the Gulf of Thailand, win the Erawan concession under a production-sharing contract.
The US company has been the main operator at Erawan gas field for over 40 years.
Authorities set 2019 to 2022 as a transition period for the change of concession holders, but the expense of decommissioning gas production rigs has become a major obstacle.
There are a total of 191 rigs, with decommissioning expenses ranging from US$10-40 million per rig. PTTEP only plans to use 142 rigs, so the remaining 49 platforms must be decommissioned.
Last year Chevron decided to proceed with arbitration against the government, but later decided to solve the problem through a negotiation that ended in September.
On Oct 3 it resumed the arbitration process.