Prime Minister Srettha Thavisin is promising to uncover “treasure” from the overlapping claims area (OCA), believed to have rich fossil fuel deposits, in an effort to source cheaper fuel and bring down electricity prices as the country moves towards green energy.
The OCA in the Gulf of Thailand, claimed by Thailand and Cambodia, has been touted as a new petroleum source for both countries because the site is near the Bongkot and Erawan gas blocks, according to the Department of Mineral Fuels.
“We will try to bring out petroleum from the area as fast as possible to serve the two countries, which depend on gas as a key energy resource,” Mr Srettha said at the Thailand Energy Executive Forum 2024 on Wednesday.
Bangkok and Phnom Penh agreed last Wednesday to resume talks on the OCA, which have made no progress since the issue was raised in 2001.
This time, Mr Srettha said, the negotiations will emphasise petroleum exploration, not overlapping boundaries.
The prime minister said he believed gas is the appropriate energy resource for Thailand as it shifts from “brown” energy, which is derived from fossil fuels, to green energy, especially renewable power sources such as solar and wind.
Thailand has a target to achieve carbon neutrality, a balance between carbon dioxide emissions and absorption, by 2050.
New gas deposits can be part of a long-term strategy to reduce power prices in the country, helping to increase the competitiveness of manufacturers. he said.
Harald Link, chief executive of B.Grimm Power Plc, said the country needs a new source of gas that can be produced and sold at lower prices.
A drop in domestic gas supply has caused the country to import more costly liquefied natural gas (LNG) in recent years. LNG prices soared in 2022 after the Russia-Ukraine war erupted.
Kriengkrai Thiennukul, chairman of the Federation of Thai Industries, said businesses want the government to use lower-priced fuel for power generation. He said the OCA could be a solution if gas is discovered there.
The current electricity tariff in Thailand is 4.18 baht per kilowatt-hour (unit), far higher than the 2.50-baht equivalent in Indonesia and 2.60 baht in Vietnam.
This hurts manufacturers’ competitiveness, Mr Kriengkrai said.
Auttapol Rerkpiboon, chief executive and president of the national oil and gas conglomerate PTT Plc, agreed with Mr Srettha that Thailand and Cambodia should focus on sharing benefits from petroleum exploration during the talks, rather than on the boundary issue.
If the talks are successful, petroleum could be extracted faster than decades ago thanks to existing exploration and production infrastructure in the Gulf, said Mr Auttapol.