IN the Samui Express issue of 12th June, I read a very interesting article about possible future drilling and oil and gas development activities off the coast of Koh Samui.

As some of you readers may know, I spent 35 years in the oil and gas industry. I do not mean to be a mouthpiece for the oil companies but rather to present a balanced viewpoint and separate fact from fiction.

I was raised in a tourist coastal town in the UK called Great Yarmouth (population: 55,000); Koh Samui has a similar number of inhabitants excluding tourists. Farther north, in Scotland, is the town of Aberdeen.

With the collapse of fishing in these two towns in the early ’60s, salvation arrived in the form of the oil and gas industry in the late sixties. Aberdeen embraced the industry in the mid-’60s without any denouements.

Today it has become a world leader in exporting oil and gas technology – 95 percent of the industry is run by the Scots. The oil-related industries and the support services required are a major source of employment and income in these regions.

It is estimated that the industry employs around 100,000 workers (or 6 percent of the working population of Scotland). Great Yarmouth, too, has become a vital cog in the energy sector producing around 30 percent of gas required in the UK.

The usual question when the oil farangs with their stetsons come into town is, “What’s in it for me?” Plenty, believe me and on several levels.

The major oil companies are acutely aware of the negative publicity that can be generated due their presence, but let me assure you, readers, that when an oil company carries out an EIA [Environmental Impact Assessment], the terms of reference are to produce a report that is heavily weighted in everything negative and why the oil company should NOT devote any further resources to the project.

If the terms of reference to kick-starting the project remain favorable, they will then move into a local consultation and “let’s work together” phase, which will further expand on the risks associated firstly during the drilling program and then the actual platform installation and production operations program.

On the positive side, and with personal experience, I envisage the following benefits for Koh Samui:

1. I know the fishermen will be handsomely compensated without risk to their livelihood. When you install a fixed structure offshore, fish stocks actually increase as these platform offer natural breeding-ground sanctuaries and feeding areas.
2. I notice the tourist operators side with the environmentalist lobbyists. I have no idea why, as they are depriving themselves of a large income stream. On average during a drilling program, which can last anywhere from 12 to 18 months, 120 people will be coming into Samui and 120 people leaving for their rotational holiday (that’s over 3,000 air tickets to Europe and the USA). In addition, support services onshore will require another 300 personnel (that’s another 3,000 – 4,000 air tickets per year).A certain percentage may want to live on Samui; well, tour operators, you have a captive audience; they are all big spenders and will utilize hotel rooms, eat and drink and give the local economy a boost, the likes of which Samui has never seen
3. If oil or gas is found, it is not uncommon for the project to last 20–25 years (normally two-three years for the development of the oilfields and the remaining years for production). The benefits for the Samui economy really kick in at this stage with the following becoming a reality, and remember, whatever is installed has to be removed and the seabed has to look as if no activity has ever taken place
   
   
   • The raising of skill sets of Thai citizens who can then export their services throughout the world with a very high rate of return to the Thai economy
   • Oil and support service companies often set up scholarships for gifted students from poor families. I have known people that have ended up at Harvard University funded by the oil company.
   • I doubt if Chevron would get involved with a project that generates less than 100,000 barrels per day. At current oil prices ($70 per barrel), that is revenue stream of $7,000,000 per day) – without counting the tax revenue for the federal government. Samui would be in a position to negotiate a royalty agreement for up to 5 percent of the daily production – that’s $350,000 per day (Bt12 million per day of found money, not to mention the local services that would be required to support the production (and yes, fishermen, they will buy your fish as well).
   • There are many instances of oil companies spending money on locally and regionally imported infrastructure to support their operation. If they find gas, the Samui authorities should negotiate the installation of power generation on the offshore platform at a level two-three times greater than the oil companies’ requirement offshore. The surplus can then be imported via a power cable from offshore to a local substation; imagine, no more power cuts
   • Oil companies need vast quantities of water for their offshore operations; it would be wise for the local authorities to negotiate for the oil company to build a water pipeline from the mainland to the Samui water-gathering facility. This would be a very tiny amount in the overall budget strategy for the likes of Chevron.
   • Finally, the icing on the cake, if gas is found: Samui could build its own modern and environmentally friendly power station (gas is a carbon-neutral fossil fuel and does not produce greenhouse gases) and start to export power to other parts of Suratthani.
4. Yes, there are risks, but as the old adage goes, no risk, no reward. In conclusion, I wonder how may of these so-called environmental lobbyists drive cars, motorbikes; run air conditioning; use gas cookers and electricity.

If you are an environmentalist and don’t use any of the aforementioned luxuries of the modern age, I salute you and take back everything written in this column – please pay me the courtesy of inviting me to your house. I really want to know how you do it; who knows, I too might live like you. (Please e-mail comments to This e-mail address is being protected from spambots. You need JavaScript enabled to view it .)