"Kurujit" urges the state to urgently revise the petroleum law to align with the modern industrial context, boost competitiveness after ASEAN countries have amended their laws — including cutting taxes and royalties — in hopes of attracting long-term foreign investment in petroleum exploration and production. He expresses concern that petroleum fields with concessions coming up for renewal will affect the continuity of gas production, as happened with Erawan.
Mr. Kurujit Nakornthap, Director of the Petroleum and Energy Institute of Thailand (PEIT), revealed that since 2005, Thailand has not discovered any new petroleum fields of a size comparable to the Erawan field, forcing the country to import increasingly large volumes of expensive liquefied natural gas (LNG) from abroad. This has had an impact on the industrial sector and the overall competitiveness of the Thai economy. At the same time, multiple petroleum fields — covering both natural gas and oil — in Thailand are approaching the expiry of their petroleum concession renewal contracts. In order to prevent a disruption to natural gas production similar to what occurred when the Erawan field (Production Sharing Contract, or PSC) was put out to tender, the Department of Mineral Fuels is preparing to propose amendments to the law to bring it in line with the changed circumstances.
Many producing petroleum fields have entered the brownfield phase — that is, late-life producing fields. Although resources remain and production can continue, they require sustained investment, new well drilling, and increasingly flexible management. Meanwhile, the Petroleum Act governing the industry still adheres to the original structure enacted in 1971, which was designed during a period when Thailand was still at the early stages of petroleum exploration and development — a framework that is no longer consistent with the current situation.
The Petroleum Act therefore needs to be updated to keep pace with the changed context of the industry, particularly by giving the state a wider range of tools to manage petroleum fields nearing the end of their concession renewal periods, in order to maintain production continuity and make the most of remaining resources. One example would be requiring existing concession holders to submit terms for developing and producing petroleum in fields that still have potential, with the state considering extensions to the production period in ten-year increments.
Moreover, Thailand's challenges do not lie solely in managing petroleum fields whose concessions are expiring — the country must also compete with its neighbors, including Malaysia, Vietnam, the Philippines, and Indonesia, for a competitive edge in attracting petroleum exploration and production (E&P) investment. If other countries offer more investment-friendly rules — such as lower income taxes or reduced royalties — capital stands a good chance of flowing to those countries instead.
Therefore, if Thailand wishes to maintain long-term energy security, it must upgrade its investment environment to remain competitive — in terms of clear rules, policy continuity, and efficient decision-making processes. Creating incentives for investment does not mean reducing state benefits; rather, it means ensuring that Thailand can still compete with other countries in attracting investment. Without new investment, the country will ultimately lose both the opportunity to discover new petroleum fields, royalty revenues, and long-term energy security.
At present, the Sin Phu Hom petroleum field and the Sirikit field (S1) are scheduled to reach the end of their concession renewal contracts in 2029 and 2031, respectively. Under the current law, no further concession renewals are possible, even though these petroleum fields have the potential to produce gas and oil for another ten years. If a new tender is held, there are fears of a continuity problem similar to the one that arose from the Erawan field tender (G1/65). The Department therefore needs to amend the Petroleum Act — a process that will take considerable time as it must pass through parliament. Consequently, ministerial regulations and other instruments may be issued on certain points in the interim, so as not to jeopardize energy security.
The Ministry of Energy has proposed to the Cabinet a request for approval of the selected operator for the petroleum exploration and production project for onshore exploration blocks (25th round), and has opened the process for submitting applications for petroleum exploration and production rights for exploration blocks in the Andaman Sea (26th round), with expectations that foreign energy companies will show interest in bidding for the concessions.
