Council preps steps for gas shortfall

Council preps steps for gas shortfall

Erawan block supply expected to decrease

The Erawan gas field in the Gulf of Thailand. Chevron will see its gas production concession at Erawan expire in April.
The Erawan gas field in the Gulf of Thailand. Chevron will see its gas production concession at Erawan expire in April.

The National Energy Policy Council (NEPC) has approved measures to cope with a shortfall of natural gas from the Erawan gas block in the Gulf of Thailand in a bid to secure enough fuel for power generation in the country.

The measures include greater use of gas supply from other gas fields in the Gulf of Thailand, Kulit Sombatsiri, permanent secretary for energy, said on Thursday.

Natural gas accounts for 57% of the total fuel used to produce electricity, according to the Energy Policy and Planning Office.

Gas supply from Erawan is expected to decrease, following a two-year delay in entering the area by PTT Exploration and Production Plc (PTTEP), which won a bid in 2018 to operate the gas block, due to a prolonged conflict between its predecessor, US-based Chevron Corp, and the Mineral Fuels Department over which party is responsible for paying transferable asset decommissioning.

Chevron will see its gas production concession at Erawan expire in April.

PTTEP, which accessed the gas field last month, needs to take 24 months to ramp up gas production to meet the requirement of 800 million metric standard cubic feet per day (MMSCFD) under an agreement with the department.

There has been no new gas exploration at Erawan as the concession expiration draws near.

PTTEP expects gas production at Erawan to decline to 200 MMSCFD in mid-2022, down from 600 MMSCFD at present, causing a need for more gas supply to offset the shortfall.

Mr Kulit said around 250-300 MMSCFD of gas from other sites is needed.

This new supply can come from Arthit and Bongkot gas blocks as well as the Malaysia-Thailand Joint Development Area, which currently produce 220, 700 and 250 MMSCFD of gas, respectively.

Another measure is to import additional liquefied natural gas amounting to 4.5 million tonnes this year, an increase from 5.2 million tonnes in the original plan.

To secure enough electricity supply in case demand for gas is high this year, the NEPC agreed to grant a one-year delay for the retirement of Mae Moh coal-fired power plant (Unit 8), with capacity of 300 megawatts, in Lampang.

The facility was earlier scheduled to start decommissioning by its operator -- state-run Electricity Generating Authority of Thailand (Egat) -- on Dec 31 last year.

Mr Kulit said the NEPC also approved the purchase of 1.5 billion kilowatt hours from 40 biomass power plants under the small and very small power producer scheme.

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