Bangkok Post : PTT bids to limit fa

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Bangkok Post
August 5, 1998 
PTT bids to limit fall-out from smaller gas delivery 
But experts warn the move has come too late 

Supara Janchitfah

The Petroleum Authority of Thailand (PTT) is seeking to reinterpret the
Yadana gas contract to minimise possible damage from the taking of a
smaller delivery than agreed.

The agency was acting in the national interest and would pay only for the
amount of gas received, said Songkiert Tansamrit, the PTT spokesman.

Deliveries from Burma's Yadana field began this month, with the PTT
expecting five-10 million cubic feet per day (mcfd) instead of 65 mcfd,
which will be increased to 325 mcfd toward the end of the year.

Mr Songkiert said payment for the undelivered gas would be made at the end
of the year.

A law expert, however, said the attempt had come too late. Panas
Tassaneyanont, former dean of Thammasat University's Faculty of Law, said
the move should have been made while the protest against the pipeline
installation was under way.

The government could have ordered the PTT to stop the project by invoking
the "Act of Government" clause, Mr Panas said.

Pibhob Dhongchai, an adviser to the Kanchanaburi Conservation Group, said:
"Had the PTT listened to the environmentalists, we would not have wasted a
large amount of money [for damage] while saving our fertile forest."

The PTT insisted the only loss incurred would be interest for the full
65-325 mcfd it had agreed to take, while in reality it only receives
five-10 mcfd.

The reduced amount was due to the delay in the installation of generators
at the Ratchaburi power plant, the sole user.

Mr Songkiert said the plant was expected to be ready to receive the full
amount by next year. In addition, he said, the PTT would ask the
Electricity Generating Authority of Thailand to use more Yadana gas than
supplies from the Gulf of Thailand, and bunker oil and diesel oil.

However, Siritad Glankwahmdee, Egat's assistant governor, said any change
in the type of fuel must be decided by the government. Furthermore, there
were technical aspects which made it impossible for certain generators to
use fuel other than that they were designed for.

Any switch of fuel to Yadana gas was bound to increase production costs,
which would be passed on to consumers, he said.

"Currently, consumers have to pay 50 satang more per unit of electricity
because of the baht devaluation," Mr Siritad said. Furthermore, Yadana gas
cost US$3.48 per million BTU while Gulf gas cost US$2.5 per million BTU.

Mr Siritad said Egat is committed to buying gas from the PTT even though a
contract between the two state enterprises is only now being negotiated.