Bangkok Post : YADANA GAS- Delivery

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Bangkok Post
August 1, 199

YADANA GAS

Delivery woes may cost country dearly 
Egat fails to install generating units

Supara Janchitfah, Vasana Chivarakorn

The Petroleum Authority of Thailand could incur tens of millions of dollars
in damage as it starts taking delivery of gas from Burma's Yadana field
today at a much smaller amount than agreed upon.

As originally planned, the entire amount of gas would go to the power plant
at Ratchaburi belonging to the Electricity Generating Authority of Thailand
which is the sole purchaser.

PTT said earlier that the flow rate of gas would be only 5-10 million cubic
feet per day (mcfd) compared to the minimum 65 mcfd as agreed which would
be increased to 325 mcfd by the end of the year.

The reduced flow rate is the result of Egat's failure to install generating
units as planned. Instead, Egat has moved a burner from Kamphaeng Phet to
Ratchaburi to receive the gas as a stop-gap measure.

According to Egat assistant governor Siridat Glankwamdee, the installation
of electricity generators at Ratchaburi is expected to be completed by
December this year.

PTT has claimed earlier it was subject to pay US$81.57 million to the
Yadana consortium if it failed to take the Burmese natural gas supply by
the end of the year.

Mr Siridat said the delay was caused by suppliers of the power plant's
generators. However, he said the fine to be imposed on the suppliers is
minimal, only 0.1 per cent of the contract's value. He did not have the
figure at hand.

Mr Siridat also revealed that the quality of the Burmese gas received
during the three-day trial run was far below the requirement.

"During the test run, we found that the gas we received was far below the
standard. Instead of generating heat at 900 to 1000 BTU per cubic feet, the
Yadana gas can only produce 730 BTU."

He added that Egat and PTT are currently working out a contract for the
purchase of the Yadana gas for the Ratchaburi power plant.

No PTT executives were available for comment yesterday.

Mr Siridat said the demand for electricity this year has dropped for the
first time. The current estimation is 14,180 megawatt (MW) compared to
14,506 MW last year. A previous report by Egat confirmed the country has
excess capacity for electricity generating.

Environmentalists yesterday demanded that PTT reveal the total damage
caused by the delay in the power plant installation.

"This is such a huge waste of money for taxpayers like us to bear
especially in the middle of an economic crisis like this," said Pibhob
Dhongchai, one of the leading critics of the gas pipeline project.

"The power plant is only partially completed, and now we get much less gas
than we actually pay for each day," he added.

Mr Pibhob said the delay reflected a mismanagement by the PTT, and it
should make public the total amount of loss from the deal.

PTT, meanwhile, is going ahead with building a pipeline system from
Ratchaburi to Wang Noi in Ayutthaya to provide another feedline for the
Burmese gas.

The National Environment Board on Wednesday approved the project's
environmental impact assessment study.

The 156-kilometre pipeline with 30 inches of diameter will be laid under
high-voltage cables from Ratchaburi through Nakhon Pathom, Nonthaburi,
Pathum Thani, ending at Wang Noi, said project director Suphon
Tubtimcharoon.

The gas will be transferred to Wangnoi and Sainoi power plants as well as
power plants under Egat's Independent Power Producer scheme.

PTT has to ask for an approval for this 8,400-million-baht project from the
National Economic and Social Development Board and the cabinet. Mr Suphon
expected the project construction would start late this year.