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Brief history of the country
Laos (the Lao People's Democratic Republic) is a land-locked country in Indochina bordered by Myanmar and China (northwest), Vietnam (east), Cambodia (south) and Thailand (west).
Settlements in Laos date back to 4,000 BC. Tribes migrated from China around 800 AD followed by Khmers expanding into Vientiane and east to Champa. The kingdom of Lan Xang Hom Khao was founded in the 14th century and Laos became a trading centre.
Periods of growth and decline ended in 1713 when the region split into the Luang Phrabang, Vientiane and Champasak kingdoms. Burma (Myanmar) overran the north in 1763 and the south fell to Siam (Thailand) in 1779. In 1893 France then added the 3 regions to the French Indochina protectorate, uniting Laos again as a buffer state.
After World War 2 the nationalists declared independence but France re-took the country until defeat in the First Indochina War. Full independence was achieved in 1953. A civil war followed between a US-supported Lao monarchy and Hmong hill tribes, united against the Communist Pathet Lao, supported by Vietnam. Laos was later subjected to intense US bombing targeting the Ho Chi Minh Trail, despite it never being at war.
The Communists prevailed in 1975 and Vietnam controlled Laos into the 1980s. The country has now adapted to a market economy dependent on agricultural trade with neighbours, hydroelectric power, mining and foreign aid. It has an ongoing challenge to remove unexploded ordnance (UXO) which has continued to kill and maim.
Oil and gas summary
Laos is the only land-locked country in Southeast Asia. It is thickly forested and mostly mountainous with minor plains and plateaus. Its highest mountain is Phou Bia at 2,818m.
The Mekong River forms the western boundary with Thailand, the Annamite Range the eastern border with Vietnam, and the Luang Prabang Range the northwestern border with Thailand.
The country is underlain by the stable Indo-China tectonic block in the south and the Shan-Thai block in the north.
The only area with potential for hydrocarbons is the intra-continental Khorat basin in the southwest, a small part of which lies in Laos. Here Palaeozoic and Mesozoic continental fluvial and shallow marine carbonates may contain gas in reservoirs analogous to those producing in Thailand. One well drilled in 2010 had gas shows in these sediments.
However, due to its turbulent history and poor petroleum potential, Laos has seen only limited exploration activity.
Although there may be gas potential in the Khorat basin, the country has no indigenous oil or gas resources and Globalshift does not forecast any commercial production in the future.
LAOS
Map and National Flag
VIENTIANE
Presidential Palace
Southeast Asia
Capital
Population
Land area (sq kms)
Oil prod (000s b/d)
Gas prod (bcm/yr)
Oil cons (000s b/d)
Gas cons (bcm/yr)
Vientiane
6.4 mm
236,800
None
None
3.5
None
Government
Laos is one of the world's 4 remaining one-party socialist states officially espousing communism (along with China, Cuba and Vietnam). Vietnam continues to have a significant influence on the state.
The head of state is the president who is also General Secretary of the Lao People's Revolutionary Party.
The head of government is the Prime Minister. Policies are determined through an 11-member Politburo and a 61-member Central Committee.
The Ministry of Energy and Mines oversees exploration contracts in the country.
Laos is a member of the Association of Southeast Asian Nations (ASEAN) which it joined in 1997.
Geology and History of Exploration
Land-locked Laos is underlain by the stable Indo-China tectonic block in the south sutured against the Shan-Thai block in the north.
Pre-Cambrian metamorphic rocks are present in the northwest and east. There were numerous granite plutons emplaced during the Devonian to Triassic whilst in the Permo-Triassic acid volcanic rocks were extruded in the south.
Although rich in minerals, this type of terrain has limited un-metamorphosed sedimentary cover and Globalshift considers it to have no oil or gas potential.
Palaeozoic and Mesozoic continental fluvial and shallow to deep marine sediments outcrop in the southwest. These were deposited in the intra-continental Khorat basin, a small part of which lies in Laos. This basin area mostly underlies Thailand and the closest production is at the Phu Horm gas field, 200 kms to the west.
One well was drilled in Laos in 2010 and had gas shows in upper Cretaceous carbonates and in the lower Permian and Carboniferous.
The structural regime is complex with multiple episodes of compression, uplift and erosion.
History - Oil shows were first reported in Laos in 1935 east of the Mekong River but no exploration was carried out until 1959 when 2 exploration permits were awarded to a French company. Very little activity occurred and the company pulled out in 1960.
In 1974 exploration was restarted but ceased when the communists took over. In 1989 the country began negotiating contracts based on its foreign investment laws and Enterprise Oil signed up the Savannakhet PSC to the east of the Mekong river in 1989. In 1990 Hunt Oil Company signed the Pakse PSC and in 1991 Monument Oil & Gas signed the Vientiane PSC.
Drilling began in 1996 when Hunt spudded the dry Pakse-1 well, the first in the country, but the PSC was relinquished in 1997. Enterprise withdrew in 1998, followed by Monument in the same year after it had drilled the dry Naxay-1 well.
In 2007 Salamander re-signed the Savannakhet PSC and spudded the Bang Nouan-1 exploration well targeting gas in Permian limestones of the Pha Nok Khao formation in the eastern Khorat basin.
A total of 2600 kms of 2D seismic data was acquired over the prospect area and the well was declared a discovery although only gas shows are now reported. Oil seeps and bitumen staining have been seen to the east and north of this well.