Petroleum Authority Talks About the Price of Oil

29th March 2008
By Sok Serey
Radio Free Asia
Translated from Khmer by Khmerization

An official from the Petroleum Authority of Cambodia on Friday said that even if Cambodia can extract natural oil and gases from the Cambodian seabeds in 2011, the high prices of petrol in Cambodia will not drop lower than the prices of petrol in the world markets.

Mr Te Duong Dara, Secretary General of the Petroleum Authority of Cambodia, in a press conference in Phnom Penh on the management of oil and gas revenues for the alleviation of poverty in Cambodia, said that Cambodia cannot isolate itself from the rest of the world, so the local prices of oil and oil exports will have to depend on world market prices.

He stressed that the prices of Cambodian oil cannot be set differently from other countries of the world. Otherwise, all other countries will flock to buy oil from Cambodia and the Cambodian oil reserves will dry out very soon.

In relation to the above issue Mr Sok Hach, an economist based in Cambodia, declined to make any comments regarding the issue.

But Mr Son Chhay, a parliamentarian from the opposition Sam Rainsy Party, said there were so much secrecy regarding the oil issues. He said: “We have observed that there were so many hidden secrets regarding the oil explorations because the agreements made between the government and the oil exploration companies have never been released to the public. What we are very concerned about is the embezzlement of oil revenues by the persons who control those oil revenues.”

Mr Te Duong Dara’s comments were made at a time when there are anticipations that Cambodia can extract oil and gases for the first time from Block A in the next 3 years- that is in 2011.

He did not mention how much oil and gases can be extracted and how much revenues can be generated. But he noted that Cambodia’s partners in the oil exploration were not only the US oil company Chevron but they include the World Bank, the Asian Development Bank and some donor countries as well.

Based on the research conducted by the United Nations, the World Bank and other institutions in 2007, the oil reserves under the Cambodian seabeds were estimated to be about 2 billion barrels and natural gases at 283 million litres, which will generate revenues to the tune of 6 billion US dollars in the next two decades, based on the world market prices.

Other than Block A oil wells that Cambodia plans to extract for the first time in 2011, Cambodia has contracted with Singaporean and Malaysian companies to extract oil from Block B, with Hong Kong and Macau companies to extract oil from Block C, with Chinese companies in Block D and with Indonesian and Kuwaiti companies, Energy, in Block E. //