Thailand Oil and Gas Market - Growth, Trends, COVID-19 Impact, and Forecast (2022 - 2027)

Thailand Oil and Gas Market - Growth, Trends, COVID-19 Impact, and Forecast (2022 - 2027)

The Thai oil and gas market is expected to register a CAGR of more than 3% during the forecast period. The COVID-19 pandemic negatively impacted the market in terms of CAPEX cuts by the national and international oil companies operating in Thailand, project delays, and supply chain disruptions. Moreover, the lower crude oil demand led to a significant dip in the crude oil prices in the first half of 2020, which further pushed the oil and gas companies to change their investment plans in 2020. However, the situation is expected to change in the coming years, as the investments in the upstream and downstream sectors are expected to increase during the forecast period. However, crude oil reserves are declining in Thailand, and the country has to depend on imports to meet the increasing primary consumption. The political crisis, massive flooding, and indecision about revisions to the Petroleum Act stalled government projects are expected to restrain the market growth.

Key Highlights

• The upstream sector is expected to dominate the Thai and gas market, owing to new discoveries and investments.
• The LNG demand is expected to increase over the forecast period, considering the global carbon emission reduction goals, which is expected to increase the demand for natural gas for power generation. Furthermore, the government is considering an investment in various LNG projects, which can create opportunities for market growth in the near future.
• Upcoming midstream and downstream projects in the country, owing to the increasing exports and anticipated recovery in the petroleum product demand, are expected to drive the market during the forecast period.

Key Market TrendsIncreasing Investment in Oil and Gas to Reduce the Dependence on Imports

• Thailand's proven crude oil and natural gas reserves are expected to shrink over the forecast period at average rates of 7.3% and 2.8% per annum, respectively. Moreover, there is very little scope for significant new oil and gas field discoveries, which will be needed to counter the decline in mature fields.
• The declining oil and gas reserves led to an increase in the import of crude oil, which led to a rise in oil prices. In 2019, to meet domestic demand, Thailand imported 49,688 million liters of crude oil, a rise of 11.59% from the previous year's imports. Though the crude import in the country declined in 2020 and 2021, the import figures are expected to continue growing during the forecast period.
• Persistent uncertainties in the regulatory and licensing environment already delayed the much-needed upstream investment in the country.
• With the increase in imports and the decreasing reserves, the government is regulating the policies to promote the investment to decrease the reliance on imports.
• The investments are likely to increase in the production of oil and gas over the forecast period. With the increasing production, the midstream and the downstream sectors are likely to witness growth in processing and transporting crude and natural gas.

The Upstream Sector to Dominate the Market

• Thailand's upstream oil and gas production is predominately sourced from two offshore areas in the Gulf of Thailand: the Pattani Basin and the Malay Basin. Due to the fractured nature of offshore geology, Thailand's reserves and production are provided by many separate but relatively homogenous reservoirs spread across the two basins.
• In 2019, PTT Exploration and Production Public Company Limited, the national petroleum exploration and production company based in Thailand, announced a five-year investment plan (2019-2023) worth a combined USD 16.105 billion to support its business expansion domestically and overseas.
• Following its five-year plan, PTTEP planned to invest USD 3.256 billion in 2019, USD 2.946 billion in 2020, USD 3.479 billion in 2021, USD 3.56 billion for 2022, and USD 2.864 in 2023.
• The government is revising its policies to attract foreign investments. In 2018, the government awarded a production sharing contract for the first time. The PSC contract is expected to boost investor confidence and attract more investment over the forecast period.

Competitive Landscape

The Thai oil and gas market is moderately consolidated. Some of the major companies operating in the market include PTT Public Company Limited, Chevron Corporation, Schlumberger Ltd, Halliburton Company, and CAZ (Thailand) Public Company Limited.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
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