UPDATE: Chevron Executive: Speeding Up Thailand Platong II Gas Project

Chevron Corp. (CVX) said Wednesday that it hopes to advance the startup of a $3.1 billion natural-gas project in the Gulf of Thailand to this year, in the latest step by the U.S. major to cash in on booming Asian demand for cleaner-burning fuels.

The company wants production to start later this year to meet rising Thai demand, Chevron's president of Asia Pacific upstream activities, Jim Blackwell, said in a ceremony to mark the completion of the project's main gas-processing platform.

The platform is now scheduled to be installed in the second quarter of this year.

"We understand the need to accelerate," Joe Geagea, Chevron's managing director in Southeast Asia, told reporters on the sidelines.

Chevron had previously said the Platong II project would produce its first gas in 2012. However, the Thai government had separately said it expected to receive the first cargo in July this year.

Chevron owns 69.8% of the Platong II project. The remaining interest is owned by Mitsui Oil Exploration Co. Ltd. and Thailand's PTT PCL (PTT.TH).

PTT, the country's largest energy conglomerate by sales, will buy all the gas for supply to customers including its subsidiaries in the petrochemical industry.

Platong II aims to process 420 million cubic feet per day at its peak. That's roughly equivalent to 10% of Thailand's natural-gas demand, which Energy Minister Wannarat Charnnukul forecast last month will climb 6.1% this year to 4.34 billion cubic feet a day.

The California-based Chevron is placing a series of multibillion dollar bets on natural gas in the Asia-Pacific region, where growth in greenhouse gas emissions due to a reliance on crude oil and coal is spurring governments to promote cleaner-burning fuels.

Natural gas consumption in Asia's emerging economies, led by China and India, is projected to rise 65.4% to 463 million metric tons of oil equivalent in the 2008-2020 period, the International Energy Agency says.

Many of Chevron's investments are focused on expanding its footprint in China, the region's largest economy, or developing trillions of cubic feet of natural gas reserves offshore Australia that can be cooled to a liquid and shipped northward to energy-deficient nations like Japan.

However, Platong II will further entrench Chevron in Thailand, where natural gas already meets around a third of the country's electricity demand. Much of this supply comes from the Gulf of Thailand, where Chevron operates 14 blocks.

Thailand is also investing heavily in natural-gas infrastructure to meet future demand, including pipelines from offshore fields in Myanmar and a liquefied natural gas receiving terminal being built by a unit of the state-owned PTT around 100 miles from Bangkok.

The company is also targeting a decision on whether to formally invest in the $4 billion Block B natural-gas project offshore Vietnam by the end of the year.

Chevron also said earlier it had advanced its $6 billion-$8 billion deep-water Gendalo-Gehem project off Indonesia--its single largest investment in the country--by awarding engineering and design contracts last month.

-By Max Lin, Dow Jones Newswires; 65-6415-4063; max.lin@dowjones.com

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