Southeast Asian project plans scale back

Only developments with both low breakeven costs and favourable locations are likely to proceed for the foreseeable future

The prospect of a sustained low oil price environment raises questions over whether a range of development projects in Southeast Asia will proceed. Producers in the region have not distinguished themselves in terms of cost efficiency, creating a degree of vulnerability, says Sittidath Prasertrungruang, head of research at investment firm Country Group in Bangkok. Greater proximity to Asian demand centres than competing supply options in the Mid-East Gulf has made it feasible to operate projects with oil at around $30/bl, he says. But prospect of prices lingering below that level have “changed the whole scenario”.  Complex problems Projects awaiting FID that are, in Prasertrungruang’s view, l