Horizon Oil has signed a concession agreement with the Thai Government for Block G10/48 in the southern part of the Gulf of Thailand.

The Sydney-based company yesterday said it and its partners had previously been advised that their group was the successful bidder on the block. The G10/48 concession is in the southern Gulf of Thailand immediately south of the giant Pailin field and west of the Bongkot field.

Covering 18,780 sq km, the concession contains the southward extension of the Pattani Trough, which is the main producing basin in Thailand. It has production of 2.2 billion cubic feet of gas per day and 95,000 barrels of oil per day.

Chief executive officer Brent Emmett said the block "typifies" Horizon's exploration objectives. "It is a material acreage position in a fairway where the productive analogues are well understood, operating conditions are benign, oilfield services and infrastructure are abundant and where there is a high local demand for both oil and natural gas," Emmett said.

The company said the concession would allow the partners to explore for hydrocarbons over a period of seven years and required an agreed minimum work program to be carried out. It said the consortium had also submitted a bid on neighbouring G11/48 block and expects a response from the Thai Government in "the next month or so."

Horizon holds a 25% interest in Block G10/48, while operator Pearl Oil has a 50% stake and Tana Oil & Gas, 25%.