TOTAL'S leading upstream oil and gas executive reiterated Thursday that Cambodia and Thailand would have to resolve a dispute concerning joint claims over a 27,000-square-kilometre offshore area in the Gulf of Thailand before it could begin exploration in its new concession on Block III.

The Kingdom's Cabinet announced that Total had won the concession Tuesday following meetings in Paris that included Prime Minister Hun Sen, but Phnom Penh and Bangkok are yet to come to an agreement on how the overlapping area will be developed.

"The ball is between the two governments. It is not the role of an oil and gas company [to interfere]," said Total's Jean-Pierre Labbe.

"The companies are not allowed to do anything until it is resolved."

The conditional agreement with Total comes after the French oil giant made a formal proposal early last year after years of discussions with the government.

"It's nothing new," said Labbe, referring to a similar overlapping dispute between Brunei and Malaysia that was recently resolved, allowing oil companies to begin preliminary operations in the areas in question.

Negotiations needed

Phay Siphan, spokesman at the Council of Ministers, said it remained the Kingdom's right to offer concessions in overlapping areas of the Gulf of Thailand.

"Once Cambodia decides to give a concession to Total, it is the intention of Cambodia.... Thailand gives another, it is the intention of Thailand," he said.

A source at the Cambodia National Petroleum Authority (CNPA) who declined to be named agreed that negotiations with Thailand would have to come later.

"This is a disputed area," he said. "Finally, both sides should meet for a solution."

CNPA Director General Te Duong Thara and the Thai Embassy in Phnom Penh were both unavailable for comment Thursday.

In similar cases in the past, countries have typically demarcated offshore areas through negotiation or agreed to jointly develop oil and gas fields, as was the case with Sao Tome and Principe and Nigeria in 2002.

The case was one of many that have been highlighted by the UN Development Programme in Cambodia in publications related to the Kingdom's energy situation.