After Union Oil's discovery of large offshore reserves of gas in the early 1970s, Thailand was presented with an opportunity to reduce its almost complete dependence on oil imports for its commercial energy supplies. This, however, required considerable changes in the structure of its energy supply and the creation of a new industry in which Thailand had no previous experience. Faced with this challenge, the government of Thailand investigated several possible alternative scenarios, and associated the World Bank, which had a long experience in the power sector, the major potential gas consumer. This cooperation, involving the public sector, the international oil industry, and the international financial community resulted in one of the first successful developments of nat ral gas by an international oil company for the purpose of meeting the domestic demand of a developing country. The paper presents the various issues that had to be faced during the preparation and implementation of this project and elaborates on its possible value for other countries.

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