ASIA TRYING TO FOSTER OIL EXPLORATION, SAYS U.N.
Asian countries are offering better oil
exploration concessions to avert damaging shortfalls due to
last year's oil price slump, the United Nations said.
    The Bangkok-based U.N. Economic and Social Commission for
Asia and the Pacific said in its annual report that the price
fall substantially cut exploration by foreign oil firms, which
found it unprofitable to maintain investments in the region.
    Oil production investment in Indonesia fell to about 2.8
billion dlrs in 1985 from 3.2 billion in 1983 and was estimated
to have declined six pct last year. There were 11 wells drilled
in Thailand in 1986 against 64 in 1985.
    The report said <Thai Shell Exploration and Production Co
Ltd>, a unit of the <Royal Dutch/Shell Group> announced a 30
pct cut in exploration and production spending last year.
    To counter declining output, India and Malaysia reduced
petroleum sharing demands, while Indonesia cut taxes.
    Nepal offered a guaranteed income share of up to 87.5 pct
to cover exploration costs, while Thailand began decreasing its
12.5 pct royalty payments. The big losers were major regional
exporters such as Indonesia, Brunei, China, Malaysia and Iran.
Their aggregate oil income fell an estimated 20 billion dlrs in
1986 from 40 billion the previous year.
    Indonesia's export earnings fell by nearly half in 1986
from 11.6 billion dlrs in 1985, the U.N. Report said.
    Iran also lost about six billion dlrs, Brunei 3.8 billion,
China three billion and Malaysia 0.8 billion.
    However, Asian importers saved between eight and nine
billion dlrs during 1985 and 1986, which considerably eased
their balance of payments.
    South Korea, the Philippines, India, Thailand and Pakistan
were major beneficiaries, with Thailand and Pakistan
respectively saving about 875 mln and 435 mln dlrs last year.
 REUTER
