The agreement would provide for a long-term extension of the Erawan and Unocal 2/3 contracts, which cover all of Unocal's natural gas and condensate production in the Gulf of Thailand except for the Pailin field.
"We are prepared to make the large investments in further exploration drilling, production facilities, wellhead platforms and development drilling that will be required to deliver the increased gas volumes," said Randy Howard, president of Unocal Thailand.
Howard said that Unocal plans to invest several billion U.S. dollars over the life of the contracts starting in 2004 to provide the additional gas supplies need to meet Thailand's energy needs.
The agreement would increase contract volumes from the current 740mmcfd to 850mmcfd with the completion of PTT's third transmission pipeline in 2006, and further increase to 1,240mmcfd to meet the market demand in subsequent years.
Unocal is operator and holds a 64% working interest net of royalty with co-venturers Mitsui Oil Exploration and PTT Exploration and Production Public Co.
Earlier this month Unocal signed an amendment to the sales contracts covering natural gas production from the Pailin field offshore Thailand. That agreement increased the contract quantity by nearly 12% to 368 mmcfd.
