BANGKOK, Oct. 31 (UPI) -- Long-term fiscal policies in Thailand's booming economy might put the countries energy sector at risk, analysis Friday from Wood Mackenzie found.
A report released Thursday from the World Bank Group found Thailand improved its business environment to the point that it's among the best economies worldwide and the second best among emerging East Asian economies when it comes to doing business.
Under the terms of the country's current fiscal regime, Thailand's government takes 67 percent of oil and gas profits, compared with a 58 percent share average nationwide.
"There have been comparisons made with fiscal terms on offer in other South East Asian countries, but these comparisons must also consider a country's remaining prospectivity," Craig McMahon, Wood Mackenzie's head of Asia Pacific, said in a statement Friday.
The current average size of an oil and gas discovery in Thai territory is the smallest in the region and, at current rates, Wood Mackenzie's analysis finds commercial reserves in Thailand will be exhausted within nine years.
Friday's report says Thailand is not in a position to increase its share of oil and gas profits. Wood Mackenzie therefore recommends Thailand capitalize on what it has left in terms of natural reserves.
"If clear guidelines are offered on the future of expiring licenses, the country could stimulate new investment in mature fields, potentially increasing recovery of their remaining resources," McMahon said.
