March 30, 2017 / 1:16 PM / 6 months ago

Thailand amends law to give more energy exploration options

BANGKOK, March 30 (Reuters) - Thailand’s military-appointed assembly approved an amendment to a petroleum law on Thursday which will give companies more options for exploration and production operations.

Currently, oil and gas companies must get a concession to operate in a Thai field. The proposed amendment will add the option of striking production sharing agreements (PSA) or service contracts.

Thailand’s Erawan gas concession, operated by Chevron Corp. , and the Bongkot gas concession, operated by state-backed PTTEP Exploration and Production PCL, expire in 2022 and 2023.

The government wanted new arrangements in place before these are concessions were renegotiated.

During the parliamentary session, a contested clause allowing the government to set up a National Oil Company was dropped from the bill. By taking a stake through a national energy company, the government could get a share of the profits from any block while also potentially bearing some of the risk.

Although the majority-state owned PTT Pcl is the biggest shareholder in PTTEP, private shareholders still have a say over its activities and also take some of the profits.

Parliament said the cabinet must set up a committee within 60 days to conduct further studies on how a state company should operate. The study must be completed within one year.

Critics say such a company is not necessary and could be an avenue for corruption. (Reporting by Panarat Thepgumpanat and Patpicha Tanakasempipat; editing by David Clarke)

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