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Thailand Coup d’état leaves Foreign investors on High Alert

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BANGKOK — Foreign investors are on high alert after the Thai military’s declaration of a coup d’état Thursday, fearing more violence could disrupt their business operations and erode the country’s appeal.

The declaration of a coup comes amid seven months of political uncertainty that have weighed on Thailand’s economy and its industries.

In its first annual contraction since 2011, Thailand’s real gross domestic product shrank 0.6% in the first quarter from a year ago. Meanwhile, automobile sales and production continue to plunge, leading to thousands of layoffs in one of Thailand’s leading industries.

“People are shocked and surprised” by the coup, said Marc Spiegel, vice chairman of the Joint Foreign Chambers of Commerce in Thailand, which represents 29 chambers of commerce with 8,500 member companies. “They are wondering: Can I go to work? Can I do business in Thailand?”

Many manufacturers are sitting tight.

Japanese camera maker Nikon Corp., which makes around 90% of its digital single-lens reflex cameras in Thailand, said political upheavals in the kingdom don’t usually affect production facilities. If airports get shut down, however, there could be an impact on logistics, a Nikon spokesman in Tokyo said.

Toyota Motor Corp. and Ford Motor Co. said the declaration of a coup hasn’t affected auto production, although the companies are closely monitoring the political situation.

The long-term danger is that, without a functioning government in Thailand, foreign investors can’t get their projects approved, and they may turn to other countries to invest, analysts say.

“How long can you keep taking a punt that Thailand is going to get itself sorted out?” said Steve Wilford, director of global-risk analysis at consulting firm Control Risks. “This situation is pushing the country toward recession.”

Thailand has had 18 coups since the end of absolute monarchy in the 1930s, the latest in 2006.

Foreign investors have begun preparing emergency measures like evacuation routes in recent months, business-risk experts said, but whether they halt production and pull people out of the country will depend on whether violence erupts because of the coup.

The Japanese Chamber of Commerce in Bangkok said that so far, it has received no reports of members planning to pull Japanese nationals out of the country.

“It’s not like coups in other countries,” said Yoshito Kato, the chamber’s member coordinator, who said he’d already experienced two coups in his 13 years in Thailand. “There’s not so much danger for foreign nationals.”

The 1,552 members of the chamber include Japanese firms in the automotive, electronics and metalworking industries, many serving car makers like Toyota Motor Corp. and Honda Motor Co., which see Thailand as their manufacturing hub in southeast Asia.

The political uncertainty is hitting Thailand’s auto industry particularly hard as consumers pull back.

Jessada Thongpak, a Bangkok-based analyst for IHS Automotive, expects up to 30,000 auto workers, or 6% of the industry, to be laid off if the political crisis continues through the end of the year.

Thailand’s auto industry already laid off about 10,000 people in May, an auto-industry trade group said Thursday, after grappling with weak demand and falling production due to the political impasse and the end of the government’s stimulus for first-time car buyers.

“Thailand’s slowing economy and delayed investment projects are largely to blame for the layoffs,” said Kovit Wongkolkitsilp, secretary-general of the Auto Parts Industry Club.

In April, Thailand’s auto production fell more than a quarter from a year earlier to 126,730 cars while sales declined more than a third to 73,242 cars.

– WALLSTREET JOURNAL

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Adoption of AI Feature as NIPetGE Pays Courtesy Call at NNPC Ltd

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Enhanced adoption of artificial intelligence and other digital technologies to improve operations in Nigeria’s oil and gas industry is taking the centre stage in relevant circles.

The issue came up strongly when the President-elect of the Nigerian Institute of Petroleum and Gas Engineers NIPetGE, Prisca Kanebi, paid a courtesy call at the Nigerian National Petroleum Company Limited (NNPC Ltd), Abuja.

Biztellers reports that the Kanebi led delegation was received by the Group Chief Executive Officer of the NNPC Ltd, Bayo Ojulari, represented by the Executive Vice President, Gas, Power and New Energy, Olalekan Ogunleye.

According to a statement made available on Sunday, discussions at the meeting focused on the future of Nigeria’s hydrocarbon industry amid global energy transition concerns, technological changes and sustainability targets.

ALSO READ: NNPC Ltd, IOCs Raise Crude Supply to Local Refineries by 103% in 4 Months

The statement indicated that the NNPC Ltd acknowledged the role of NIPetGE in policy advocacy, technical development and innovation within the sector.

Speaking during the meeting, Kanebi highlighted recommendations from the institute’s recent conference, including the proposed establishment of a national centre for intelligent energy systems to support the deployment of artificial intelligence, the Internet of Things and robotics across the petroleum value chain.

She also commended the Federal Government’s decarbonisation efforts and reiterated the institute’s support for policies aimed at improving sustainability in the industry.

The institute also recommended the creation of a hydrocarbon-linked emissions trading system to allow Nigeria to take part in global carbon markets.

The institute also proposed fiscal incentives to support local manufacturing and service delivery in the oil and gas sector, as well as the expansion of the Energy Transition Plan to include measurable upstream decarbonisation targets backed by tax credits.

Other proposals included increased public-private partnerships in emission control infrastructure, carbon capture projects and hybrid renewable energy initiatives.

Both organisations also stressed the need for stronger collaboration between industry and academic institutions to improve professional capacity and align petroleum engineering practice in Nigeria with international standards.

The institute further disclosed that its bill seeking chartered status had passed second reading and was progressing towards a third hearing at the National Assembly.

It added that NNPC Ltd pledged support for future collaborations with the institute on initiatives aimed at improving efficiency and innovation in the energy sector.

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FHC Orders NUPRC to Comply with PIA

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Local Firms Lead Revival of Idle Oil Wells – SPE

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Nigeria’s indigenous oil and gas companies are reopening dormant wells and ramping up production from assets acquired from international oil companies (IOCs) to boost crude oil output.

The Society of Petroleum Engineers (SPE), Nigeria Council, made the assertion through its Chairman, Francis Nwaochie, on the sideline of the Offshore Technology Conference (OTC) which ended at the weekend in Houston, Texas.
Nwaochie said indigenous operators were already taking advantage of opportunities created by disruptions in the global energy market to increase production from existing assets.

According to him, local firms that recently acquired onshore and shallow water assets from IOCs were aggressively reviving inactive wells and maximizing available infrastructure to raise output levels.

“What we are seeing now is that indigenous companies are reopening wells from the assets they acquired from the IOCs. Some of them have almost doubled production from those existing assets,”.

He explained that the renewed focus on dormant wells and existing facilities had become critical at a time the global oil market was facing supply shortages triggered by geopolitical tensions in the Middle East.

The SPE Nigeria Council Chairman noted that Africa, particularly Nigeria, was well positioned to benefit from the supply gap because of the continent’s relative stability compared to some other oil-producing regions.

“There is a huge opportunity for Africa right now. The focus is gradually shifting to Africa because of the volatile environment in many other producing regions.”

He stated that indigenous operators were leveraging digital technologies, financing opportunities and local expertise to improve production efficiency and optimise existing fields.

He added that stronger implementation of local content policies was also helping to create a more stable operating environment for oil and gas investments.

“Local content is very critical. Once communities and local companies clearly understand their roles and benefits, then you create peace across the industry. Business only thrives in peaceful environments.”

ALSO READ: Nigerian Navy Recovers Large Cache of Illegal Refined Petroleum Products

Nwaochie also stressed the need for Nigeria to move beyond crude oil production and begin developing indigenous technologies for the energy industry.

According to him, SPE Nigeria Council was actively supporting innovation and technology development among young Nigerian engineers and researchers.

He disclosed that the association was engaging the National Universities Commission(NUC) on reforms to engineering curricula in universities to better prepare graduates for the future of the energy industry.

“One of our major focuses in SPE is technology development. We should not only import machines and equipment, we must begin to develop our own technologies locally.”

Nwaochie revealed that SPE was already supporting local innovators working on technologies such as remotely operated underwater vehicles (ROVs), noting that indigenous technology development will strengthen Nigeria’s economy and deepen local participation in the oil and gas sector.

“We may not get everything right immediately but we must start somewhere. That is how countries that dominate the global energy industry built their capacities.”

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