After a year of changes in the global and domestic energy market, Thailand can expect further challenges in the years ahead.
Of these, the most crucial issues are the development of two coal-fired power plants in the South, the retirement of the Erawan and Bongkot gas blocks and the long-delayed 21st round of new concessions for 29 petroleum blocks.
Energy experts and operators had initially hoped that the issues would be concluded by 2017 before the military government steps down.
But final decisions appear to be a long way yet because of strong opposition from villagers in the case of the power plants, and from energy activists and non-governmental organisations on the concession issue.
The urgency for additional power supply comes about as current electricity supply in the South is 2,225 megawatts, lower than the peak demand in the region for 2016 -- 2,630MW recorded on April 18.
The biggest power users were the prominent tourist provinces, where power demand has grown by 5% each year: Phuket, Krabi, Nakhon Sri Thammarat and Songkhla.
The issue of during the peak period was solved by transmitting more power from the central region. To meet the peak demand, the Electricity Generating Authority of Thailand (Egat) had to develop more than 1,000 kilometres of high-voltage transmission lines to transmit another 375MW of power to the region. In some years, Egat has had to seek power from neighbouring Malaysia via more than 500km of transmission lines.
"There will be shortage of power supply for the South if there is no new additional capacity in the region after 2019," said Egat's former governor Soonchai Kamnoonsate.
The two power plants which the government designed to be new power suppliers for the region are an 800MW coal-fired power plan in Krabi worth 61.2 billion baht and a 2,200MW coal-fired power plant in Songkhla's Thepa district worth 138 billion.
The plants were expected to start running in 2019, but development has been delayed. Operations are now likely to begin in 2021-22.
A case in point that highlighted the need for more power supply in the southern region was the incident on May 21, 2013 when a 500kVp power transmission line was hit by lightning and sparked blackouts across 14 provinces.
"We cannot rely on other fuels for power generation because gas supply to gas-fired power plants has been short, while power generated by renewable sources is not stable," said a source at the Energy Ministry.
Apart from power supply in the South, another urgent mission for the government is to open bidding for gas and oil exploring contracts held by Chevron Corp and PTT Exploration and Production (PTTEP).
Chevron's Thai unit holds a concession to operate the Erawan gas field, while PTTEP operates the Bongkot gas field. Contracts for the two offshore fields are due to expire in 2022 and 2023, respectively.
The two blocks have a combined production capacity of 2.2 billion cubic feet per day, or around 76% of output in the Gulf of Thailand.
Thai authorities are drafting terms and criteria for the auction, which has been delayed from mid-2016. It will now be implemented in 2017, said Veerasak Pungrassamee, director-general of the Energy Ministry's Department of Mineral Fuels.
The government had put the delay down to the amended Petroleum Act, but did not elaborate. Energy experts, however, pointed instead to the Petroleum Committee's reluctance to select the kind of concession contract that would benefit Thailand in the long term.
Mr Veerasak said the Energy Ministry also plans to hold the long-delayed auction for new oil concessions, or the 21st round, in late 2017. Exploration for the 29 onshore and offshore blocks would follow soon after.
The 21st round was originally slated for 2011 but was put on hold after the big floods that year, and then by the political crisis in 2013 that ended in a military coup in May 2014.
The military government has put off bidding for the 21st round since 2015, also partly due to the benefit-sharing issue.
On the development of the oil market, Thailand's largest oil refinery, Thai Oil Plc (TOP), is to invest US$3.7 billion for a 46% expansion of oil refinery capacity to 400,000 barrels per day, up from 275,000 bpd now. The expansion will include refined petroleum improvement, which will produce refined oil with higher margins under the Clean Fuel Project.
Chief executive and president Atikom Terbsiri said bidding documents will be ready for international engineering, procurement and construction firms in April.
The trading business for liquefied petroleum gas (LPG), pegged to the gas price at a fixed rate for more than three decades, has also undergone changes. From January 2017, strict control of LPG trading has been partially freed-up, particularly in the import and export segments. LPG import will no longer be dominated by national oil and gas conglomerate PTT Plc, while exports will come under a free-trade system.
Witoon Kulchareonwirat, director-general of the Department of Energy Business, said large oil traders including PTT, Siam Gas, Unique Gas, Orchid Gas and WP Energy are all ready to handle more freely traded LPG. Smaller traders are expected to enter the market soon.
For the oil retail segment, most retailers are focusing on non-oil business amid low global oil prices, with big retailers allocating significant capital expenditure for the segment for the next four years.