Prayut said the proposed set-up would be redundant with energy companies currently majority owned by the Finance Ministry.

However, the government wants to speed up enactment of the amended petroleum legislation to boost new investment in the oil and gas sector as existing natural gas concessions are about to expire in the next few years, requiring a clear policy framework to attract investors.

Meanwhile, the People’s Network for Thai Energy Reform continued to push for the establishment of the national oil company to take charge of new petroleum contracts and concessions which will be granted by the government.

On Monday, MR Pridiyathorn Devakula, a former deputy premier in the previous Prayut Cabinet, urged the NLA to review the proposed amendment to the Petroleum Act. He argued that a new national oil company would set back the country’s energy sector for decades.

He also voiced opposition to speculation that the Defence Energy Department would be responsible for running the proposed national oil company in the initial stage.

According to the amendment to the Petroleum Act, Article 10/1 states that a national oil company shall be set up when appropriate. The People’s Network for Thai Energy Reform, led by ex-senator Rossana Tositrakul and former finance minister Thirachai Phuvanartnalanuban, said there should be a specific timeline for setting up a new national company to oversee the management of new petroleum contracts and concessions.

This should be done before the government invites investors to bid for new contracts or concessions for the lucrative Erawan and Bongkot gas fields in the Gulf of Thailand whose existing concessions expire in 2022 and 2023, respectively. Since a major investment is required, the government needs to call bidding five to six years before concessions expire so that private investors have enough time to prepare.

The Erawan and Bongkot gas fields are the country’s two biggest gas sources, accounting for a combined 70 per cent of indigenous gas production in the Gulf of Thailand. The annual value of gas produced by both fields is estimated to be worth around Bt200 billion.

The Rossana-led group said existing oil and gas companies would likely get extensions to their concessions unless there was a new national oil company to manage these energy assets.

However, Prayut insisted he has no plan for the Defence Ministry to take charge of the country’s energy affairs as speculated, but admitted there has been constant pressure from the group to establish a national oil company with threats of holding demonstrations at Government House.

The Rossana-led group also said a new national oil company is needed if additional methods to manage oil and gas assets are to be created. In addition to the concession method, the amendment to the Petroleum Act has included “production sharing contracts” and “service contracts” as new methods for the management of oil and gas resources.