Reuters: Yadana Trouble Brought to

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Unocal Unaware of Thai Yadana gas hitch

HOUSTON, Aug 20 (Reuters) - Unocal Corp.'s Chairman and Chief Executive 
Officer Roger Beach said on Thursday he was unaware of a request by the 
Petroleum Authority of Thailand (PTT) to relax the conditions of its 
contract to buy natural gas from the Yadana offshore gas field.

The Bangkok Post reported on Thursday that PTT would ask the group 
developing the field offshore Myanmar to allow it to purchase smaller 
volumes than the contract stipulated because of delays in construction of 
the Ratchaburi power plant.

The newspaper said PTT was only able to take delivery of five million 
cubic feet per day (MMcfd) while the 30-year contract stipulates delivery 
of 65 MMcfd at this stage.

PTT had hoped to persuade the Yadana group to relax the terms of the 
contract without invoking penalty clauses, the paper said.

The Yadana group consists of Total SA , Unocal (28.3 percent), PTT 
Exploration & Production (25.5 percent) and Myanmar Oil & Gas (15 
percent).

Beach, responding to reporters' questions after a Houston speaking 
engagement, said the group's Thai customer hadn't yet said anything about 
renegotiating contracted delivery volumes.

``They will take the gas. They have told us they're a little late, but 
they'll take the contracted volumes,'' he said.

Asked if the Yadana group would be willing to consider a request to 
reduce initial deliveries, he said: ``I would have to understand the 
problem there before we'd do that.''

Beach said that, in general, Unocal was willing to cooperate with Asian 
countries to help them overcome any problems they had in meeting payments.

``We are a long-term player in Asia and we have helped our partners in 
those countries...get through bad times,'' he said.

Beach said The Philippines was an example of a country where Unocal had 
shown flexibility with regard to payments.

``We've worked with them on timing of those payments. They've always paid 
us everything that was owed to us, but we're very happy to cooperate...'' 
he said.