Officials reject Thai group's claims over French oil deal

The Phnom Penh Post
Monday, 03 August 2009 15:02 Sebatian Strangio
But protests highlight the challenges of drilling for oil in disputed areas.


CAMBODIAN officials have dismissed Thai protesters' claims that a recent oil exploration agreement between Cambodia and French oil giant Total is a violation of Thai sovereignty, saying Cambodia has the right to award exploration rights inside the Gulf of Thailand's 27,000-square-kilometre overlapping claims area (OCA).

During Prime Minister Hun Sen's visit to France last month, officials announced an agreement offering Total the exploration rights to a 2,430-square-kilometre block - known as Area III - that sits inside the OCA.

According to Thai media reports, the People's Assembly of Thailand (PAT), a nationalist advocacy group, wrote to Thai Prime Minister Abhisit Vejjajiva on Thursday to criticise the government and the armed forces for not taking action to head off the deal, which they said infringes on Thai territory.

A copy of the letter was also reportedly sent to the French Embassy in Bangkok.

Var Kimhong, Cambodia's top border negotiator, said he had not seen the Thai letter, but that Cambodia had the right to award exploration rights as it saw fit.

"The Thai authorities have nothing to do with the block we have given to Total," he said. "It is under Cambodian sovereignty."

However, the letter raises questions about future exploration of the OCA, including Area III. Bangkok has also allocated the zone, which it refers to as B10 and B11, to US oil company Chevron and Japan's Mitsui.

Jean-Pierre Labbe, general manager of Total EP Cambodge, told the Post in July that Total would sign a 10-year conditional petroleum agreement for Area III, the terms of which would prevent the company from undertaking any explorations until a resolution was reached with Thailand over the ownership of the zone.

On Thursday, Thai Foreign Ministry spokesman Vimol Kidchop said similarly that any company operating inside the OCA would "not be allowed to explore or develop petroleum resources ... unless Thailand and Cambodia successfully resolve the dispute".

Joint development?
Past cases may offer a way forward with the OCA. In 2000, the governments of Nigeria and Sao Tome and Principe signed an agreement for the joint development of a disputed 35,000-square-kilometre maritime zone after failing to reach an agreement on border delimitation.

According to a paper presented at an International Oil and Gas Conference, held in Cambodia in March 2008, the two countries "agreed to work together to develop the area and to benefit from any oil or gas discoveries that are made".

Labbe said he expected some form of joint development agreement would be required between Cambodia and Thailand, rather than a strict geographical division of the OCA. But he said it was unclear whether the countries would be able to reach such an agreement.

Thitinan Ponsudhirak, a political analyst at Bangkok's Chulalongkorn University, described the issue as a "follow-on" to the standoff over Preah Vihear temple and said that the dispute was unlikely to be resolved soon.

"[The OCA issue] is held hostage to Thai-Cambodian relations, and Thai-Cambodian relations are rocky at the moment," he said by phone.

Labbe said negotiations between the two countries had been set back by the coup that removed former Thai Prime Minister Thaksin Shinawatra in 2006, but he remained optimistic that the OCA issue would soon be resolved.

"Every time there is a meeting... they discuss the issue positively," he said last month.

ADDITIONAL REPORTING BY STEVE FINCH