Chevron Thailand Exploration and Production wants to increase domestic gas supply to allow the government be less dependent on costly liquefied natural gas (LNG) imports, with the company ramping up petroleum production in the Gulf of Thailand.
The US-based firm was awarded a licence to explore and produce petroleum at Block G2/65, which covers an area of 15,030 square kilometres in the gulf, under a production-sharing contract signed with the Department of Mineral Fuels on May 30.
The department awarded another two licences for Block G1/65 and G3/65, spanning 20,133 sq km, to PTT Exploration and Production Plc in Round 24 bidding held last year.
Chevron expects to produce natural gas at Block G2/65, but also believes it will discover some crude oil at the site, which is located near the Pailin gas block where Chevron is operating, said Chatit Huayhongtong, president of Chevron Thailand.
The company is preparing to conduct a seismic survey to study the geological structure in detail in order to determine the feasibility of petroleum discovery.
It plans to drill two exploration wells within six years. If exploration confirms good prospects, further investments will be made to develop the wells into production wells.
Petroleum from this block will strengthen Thailand's energy security in the future, said Mr Chatit.
Chevron plans to make additional investments in the Pailin block and is in the process of asking authorities to extend the petroleum production period for another 10 years.
The production licence at Pailin, which comprises the Pailin and North Pailin fields, expires in 2028. Gas production at Pailin is in a range of 420-450 million cubic feet.
If the Department of Mineral Fuels approves the request for an extended production period, he said Chevron will make further investments.
Chevron also runs the Bechamas petroleum field in the gulf which is currently shut down, but the company is preparing to resume operations.
Scientists have stated natural gas is the cleanest type of fossil fuel used to produce energy. More domestic gas production would help Thailand buy less LNG, which was blamed for driving up power bills last year, while also supporting the country's plan to use cleaner energy.
"Our investment plans will not only be good for Thailand in terms of tax and royalty collection, but will also help the country deal with expensive energy prices," said Mr Chatit.
Chevron also supports Thailand and Cambodia holding talks over an overlapping claim area (OCA) between the two countries in order to jointly develop a new petroleum site in the upper part of the Gulf of Thailand. He said the next government should push ahead with the OCA talks, as Chevron is ready to participate in petroleum exploration if the negotiations are successful.