Thailand's power generating monopoly has rejected a proposal by its state oil company to build a big power plant near the Thai-Myanmar border that would be the cornerstone of a proposed joint gas development campaign off Myanmar.
Security and safety were cited as the prime reasons for the Electricity Generating Authority of Thailand's rejection of the Petroleum Authority of Thailand's (PTT) proposed site. That site, Three Pagoda Pass about 450 km northwest of Bangkok, is prone to conflicts between the Myanmar government forces and the minority Karen and Mon separatist forces.
Senior EGAT officials insist the risk of fighting spilling over to the Thai side is too great for it to approve a 300,000 kw, gas fired, combined cycle power plant at the border.
It contends an agreement to end the conflict in the area is not likely soon.
Meanwhile, PTT officials reaffirmed an interest in buying gas produced from Thai-Malaysian territorial claims in the South China Sea under a joint development project as well as from Malaysia's offshore Terengganu blocks.
DEVELOPMENT LINK
PTT proposed the site because it is at landfall of a proposed 400 km gas pipeline from prospective gas fields in the Gulf of Martaban to the western Thai province of Kanchanaburi.
EGAT's rejection means PTT will have to reconsider sites for the Thai power plant, which would be the main consumer of gas PTT has proposed developing jointly in the Gulf of Martaban. That proposal is under negotiation with the Myanmar government.
Myanmar has agreed in principle to PTT taking an interest in offshore tracts M3, M5, and M6, where gas reserves are estimated at 6.6 tcf. Production, forecast at 500 MMcfd, would be earmarked mainly for power generation, petrochemicals feedstock, and industrial use in Thailand.
ALTERNATIVE ROUTES
To keep PTT's gas project alive, EGAT offered three possible alternatives. The first calls for PTT to reroute and extend the proposed pipeline to the provinces of Ranong, Krabi, or Trang on the western coast of Thailand's southern peninsula.
EGAT has sought to establish a major power generating station in those areas to expand the power grid in southern Thailand, where demand for electricity is rising rapidly.
EGAT planners acknowledge this option's much higher cost, entailing extending the pipeline by more than another 400 km, may not justify PTT's investment.
The second alternative calls for PTT to extend the pipeline from the Three Pagoda Pass eastward to Wang Noi in Ayutthaya province, about 60 km north of Bangkok, where EGAT planned to set up a combined cycle plant rated at 600,000-1,200,000 kw.
The Wang Noi power plant was planned in conjunction with the onshore Nam Phong gas field in Northeast Thailand, where the estimate of gas reserves has been slashed. Under current estimates, most of Nam Phong's production will feed EGAT's existing combined cycle plant near the field in Khon Kaen province. Accordingly, PTT has suspended a project to lay a 390 km pipeline to deliver gas to Central Thailand.
The third option calls for PTT to extend the Martaban pipeline from Three Pagoda Pass about 250 km southeast to the town of Kanchanaburi, which EGAT considers a more logical location for the new power plant.
MARTABAN PROJECT
Myanmar's government accepted in principle PTT's proposal to take a 30% interest in the Gulf of Martaban development project.
The government will take a majority interest in the project and plans an international tender for a multinational oil company, likely to be a western firm, to be its coventurer and operator of the offshore tracts, said Thai Deputy Industry Minister Vira Susangkarakan. The agreement was an apparent breakthrough from an earlier impasse in negotiations when Myanmar's ruling junta rejected PTT's bid for an equity stake, suggesting the Thai company limit its role to that of gas buyer. PTT then threatened to withdraw from the project if its proposed role in the plan was reduced.
PTT has been negotiating Martaban development with the junta through its exploration arm PTT Exploration & Production (Pftep) (OGJ, Oct. 22, 1990, p. 23).
The number of blocks to be drilled and respective interests Yangon (formerly Rangoon) and a foreign operator would take are uncertain. But PTT is particularly interested in obtaining Blocks M5 and M6, where three big gas prone structures lie.
The 13,200 sq km M5 has two gas prospects, designated Bright Spot and 3-DA. Part of 3-DA also stretches across the western border of the 12,900 sq km M6 block near 3-CA prospect in the northwest corner of M6. The 3-CA structure overlaps the southwest area of M3, a tract covering 7,700 sq km.
PTT has talked with the Royal Dutch/Shell Group, British Gas plc, Unocal Corp., and Nissho Iwai about the possibilities of teaming up with it for the Martaban gas venture.
MALAYSIA PROJECT
Noting Malaysia's demand for gas is limited, Vira said Thailand would be prepared to take much of the gas produced from the joint development area and Terengganu via pipeline.
Reserves of natural gas are pegged at 27.1 tcf in the Terengganu offshore blocks and 3.6 tcf in the 7,300 sq km JDA block.
PTT and Malaysia's Petronas are undertaking a joint study on linking their gas grids to bring the gas from Malaysia to Thailand.
Thailand's power generating monopoly has rejected a proposal by its state oil company to build a big power plant near the Thai-Myanmar border that would be the cornerstone of a proposed joint gas development campaign off Myanmar.
Security and safety were cited as the prime reasons for the Electricity Generating Authority of Thailand's rejection of the Petroleum Authority of Thailand's (PTT) proposed site. That site, Three Pagoda Pass about 450 km northwest of Bangkok, is prone to conflicts between the Myanmar government forces and the minority Karen and Mon separatist forces.
Senior EGAT officials insist the risk of fighting spilling over to the Thai side is too great for it to approve a 300,000 kw, gas fired, combined cycle power plant at the border.
It contends an agreement to end the conflict in the area is not likely soon.
Meanwhile, PTT officials reaffirmed an interest in buying gas produced from Thai-Malaysian territorial claims in the South China Sea under a joint development project as well as from Malaysia's offshore Terengganu blocks.
DEVELOPMENT LINK
PTT proposed the site because it is at landfall of a proposed 400 km gas pipeline from prospective gas fields in the Gulf of Martaban to the western Thai province of Kanchanaburi.
EGAT's rejection means PTT will have to reconsider sites for the Thai power plant, which would be the main consumer of gas PTT has proposed developing jointly in the Gulf of Martaban. That proposal is under negotiation with the Myanmar government.
Myanmar has agreed in principle to PTT taking an interest in offshore tracts M3, M5, and M6, where gas reserves are estimated at 6.6 tcf. Production, forecast at 500 MMcfd, would be earmarked mainly for power generation, petrochemicals feedstock, and industrial use in Thailand.
ALTERNATIVE ROUTES
To keep PTT's gas project alive, EGAT offered three possible alternatives. The first calls for PTT to reroute and extend the proposed pipeline to the provinces of Ranong, Krabi, or Trang on the western coast of Thailand's southern peninsula.
EGAT has sought to establish a major power generating station in those areas to expand the power grid in southern Thailand, where demand for electricity is rising rapidly.
EGAT planners acknowledge this option's much higher cost, entailing extending the pipeline by more than another 400 km, may not justify PTT's investment.
The second alternative calls for PTT to extend the pipeline from the Three Pagoda Pass eastward to Wang Noi in Ayutthaya province, about 60 km north of Bangkok, where EGAT planned to set up a combined cycle plant rated at 600,000-1,200,000 kw.
The Wang Noi power plant was planned in conjunction with the onshore Nam Phong gas field in Northeast Thailand, where the estimate of gas reserves has been slashed. Under current estimates, most of Nam Phong's production will feed EGAT's existing combined cycle plant near the field in Khon Kaen province. Accordingly, PTT has suspended a project to lay a 390 km pipeline to deliver gas to Central Thailand.
The third option calls for PTT to extend the Martaban pipeline from Three Pagoda Pass about 250 km southeast to the town of Kanchanaburi, which EGAT considers a more logical location for the new power plant.
MARTABAN PROJECT
Myanmar's government accepted in principle PTT's proposal to take a 30% interest in the Gulf of Martaban development project.
The government will take a majority interest in the project and plans an international tender for a multinational oil company, likely to be a western firm, to be its coventurer and operator of the offshore tracts, said Thai Deputy Industry Minister Vira Susangkarakan. The agreement was an apparent breakthrough from an earlier impasse in negotiations when Myanmar's ruling junta rejected PTT's bid for an equity stake, suggesting the Thai company limit its role to that of gas buyer. PTT then threatened to withdraw from the project if its proposed role in the plan was reduced.
PTT has been negotiating Martaban development with the junta through its exploration arm PTT Exploration & Production (Pftep) (OGJ, Oct. 22, 1990, p. 23).
The number of blocks to be drilled and respective interests Yangon (formerly Rangoon) and a foreign operator would take are uncertain. But PTT is particularly interested in obtaining Blocks M5 and M6, where three big gas prone structures lie.
The 13,200 sq km M5 has two gas prospects, designated Bright Spot and 3-DA. Part of 3-DA also stretches across the western border of the 12,900 sq km M6 block near 3-CA prospect in the northwest corner of M6. The 3-CA structure overlaps the southwest area of M3, a tract covering 7,700 sq km.
PTT has talked with the Royal Dutch/Shell Group, British Gas plc, Unocal Corp., and Nissho Iwai about the possibilities of teaming up with it for the Martaban gas venture.
MALAYSIA PROJECT
Noting Malaysia's demand for gas is limited, Vira said Thailand would be prepared to take much of the gas produced from the joint development area and Terengganu via pipeline.
Reserves of natural gas are pegged at 27.1 tcf in the Terengganu offshore blocks and 3.6 tcf in the 7,300 sq km JDA block.
PTT and Malaysia's Petronas are undertaking a joint study on linking their gas grids to bring the gas from Malaysia to Thailand.
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