Thai oil and gas sector faces new political risks

Abstract

Subject Outlook for the Thai oil and gas sector. Significance A revised draft of the 1971 Petroleum Act is likely to be tabled in the National Legislative Assembly (NLA) later this year. Its passage would open a new bidding round for exploration licences for 26 onshore and six offshore blocks under regulatory and fiscal terms similar to those in existence. However, the NLA could reject the draft, delaying the bidding round into 2017-18. Meanwhile, environmental groups could intensify their opposition to exploration, both onshore and offshore. Impacts Corporate investment in social responsibility, environmental safeguards and job creation will mollify political opponents. Future central governments, whether elected or otherwise, will honour agreed contracts. Local opposition to exploration will be regionally concentrated, but draw ideological sustenance from global green movements.