DFDL has been representing Royal Dutch Shell (Shell) in relation to the USD 750 million sale of its 22.22% stake in the Bongkot field concession in the Gulf of Thailand, to PTT Exploration & Production. The deal was announced on 2 February 2018.
The DFDL team advised Shell on the tax implications of the sale and the domestic requirements relating to the interest transfer in the petroleum concession. This has involved addressing internal changes to the long-established policy of the Department of Mineral Fuels, along with new challenges arising from the set of new laws introduced in Thailand in recent years. One of which is the new Trade Competition Act, which includes new government powers to scrutinize mergers and acquisitions from a trade competition perspective. Also at issue are the new decommissioning obligations which are becoming critical as many concessions approach their expiry dates, and other associated uncertainties in the context where the actual implementation of these new rules by the regulator still remains to be seen.
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