MoU [between Cambodia and Thailand] 'should' help resolve gulf row

WATCHARAPONG THONGRUNG

THE NATION 

The Department of Mineral Fuels will propose to Prime Minister Yingluck Shinawatra and Army leaders that a 2001 memorandum of understanding be used as the guideline for negotiations to solve the territorial dispute with Cambodia over overlapping sea claims so that petroleum exploration in the area can begin. 

Yingluck will meet with Army leaders in June. If the parties agree on the guidelines, it will be forwarded for Cabinet approval before consideration by Parliament as stated in Decree 190. If Parliament agrees, negotiations with Cambodia can begin. If both countries can reach a consensus, exploration of the disputed area can begin.

Songpope Polachan, director-general of the Energy Ministry's Department of Mineral Fuels, said the overlapping sea territory between Thailand and Cambodia covered more than 26,000 square kilometres. If the dispute is settled, both sides will benefit from petroleum development as the prices of oil and natural gas are currently relatively high.

If negotiations are successful, Thailand expects to increase its reserves of natural gas by 30 per cent, which could extend the life-span of gas production in the Gulf of Thailand.

The department will propose guidelines as stated in the 2001 MoU and that the negotiations be divided into two parts. The first part is the upper territory, which will be divided by a boundary mark in which the Army and security forces of all concerned parties as well as the Ministry of Foreign Affairs will take part. The second part will cover the remaining overlapping territory, which will be a joint development area.

If the negotiations are unable to end the dispute, it could result in a lost opportunity for both countries. It is possible that in the foreseeable future other alternatives will be developed such as wind, solar or hydrogen energy that might become cost-competitive. In this scenario, the value of the gas reserves may be reduced.

Back in 1971, Thailand granted exploration rights to the private sector. However, once the overlapping territory was disputed, the Cabinet passed a resolution in 1975 terminating exploration.

Cambodia is looking for private-sector help to explore the area as well. Recently, Total Petroleum Co of France was granted exploration rights by the Cambodian government after the rights of the previous grantee expired.

Previously, Thailand faced overlapping maritime claims with both Malaysia and Vietnam, but agreements were successfully negotiated.

Under a joint venture with Malaysia, an exploration programme found an estimated 10 billion cubic feet of natural gas. In that bilateral agreement, the benefits were split 50:50 and operations were managed through a joint Thailand-Malaysia corporation.

Thailand's agreement with Vietnam established a boundary line giving Vietnam 33 per cent of the area, while Thailand received 67 per cent. PTT Exploration and Production undertook exploration and development of both areas and is currently producing about 330 million cubic feet of natural gas per day.