The Kra Isthmus Canal News 2001-2003

As a fan of Suez and Panama Canal lore, 2Bangkok.com is fascinated by a canal project right here in Thailand. The Kra Isthmus Canal would cut across the Kra Isthmus in southern Thailand and enable shipping to bypass the Strait of Malacca and head directly into the South China Sea (and vice versa). First proposed in 1677, the canal is still very much alive as former PM Chavalit Yongchaiyudh (the chief proponent of the canal) is part of the current Thai government again.

It is hard to imagine how such a megaproject would be of benefit in the twenty-first century considering the huge costs. It would probably be the last major canal project on earth.

And recently any megaproject has come under intense fire from local environmentalists (over issues of resettlement, environmental damage, etc.). With so many negatives, it is hard to imagine this project would be undertaken, but nevertheless, it has its supporters.

Prime Minister: we won't build the Kra Canal - Bangkok Post, January 25, 2003
...The contract was given to Phuket Pass Project without a proper bidding contest, and that had damaged the national image and credibility, said Gen Sakan Sathityutakarn, chairman of Kra Canal Management and Transportation System, Thailand.... ``This is quite unusual since the company has not gone through a proper channel and a formal bidding process has not yet taken place.''

Fast Facts
Status [as of 2003]: This project is still being promoted by former PM Chavalit Yongchaiyudh. The Thai Rak Thai government is spending a large amount of money to study the project.
Length: 100 km
Expected to handle: 2 billion tons a year of cargo
Cost: 500-800 billion baht

As far as we know, there is only one other website that examines the Kra Canal project. There is both a Thai and English version. The domain is registered to "Kra Canal Project Sub Committee on the Armed Forces-House of Representatives," but we have never received a response from writing them. (Thanks to Oran Viriyincy for pointing this link out.) Thanks to Pas Seangsong of Bangkok Highrises for pointing out the new artists' impressions of the Kra Canal on the Kra Canal Project website.

We also obtained the incorporation papers of the Phuket Pass Project Limited, the company created to conduct the canal study.


Kra Canal in the news

Thai sea power and the Kra Isthmus canal project - The Nation, August 14, 2006

[With new elections coming up and a new government being formed one way or another, it means the opportunity for big money projects is a possibility again.]

...A feasibility study should, they said, be carried out, even though it would cost a staggering Bt50 million. This project has been labelled the Thai Canal Project.
...He and his committee chose the A9 route out, one of 10 under review. To those in the know, the 120-kilometre A9 route is the most feasible path, cutting through the provinces of Krabi, Phatthalung, Nakorn Si Thammarat, Songkhla and Trang.
...The Thai Canal is one of the word's largest projects. It is expected to take 10 years to finish and cost around Bt750 billion, according to the report. Although the financial benefits have been meticulously studied by experts, with support from both private and government organisations, nobody really knows what the impact will be on the environment, not to mention the social cost of relocating residents. A transparent and thorough process of evaluation that includes public forums and debate on the environmental impact will reduce anxieties and dissent on the part of the public and civil-society organisations.


Thai canal plan to save millions - The Age, March 29, 2005
[As predicted, this project has returned as it does after each new government is formed.]
A $23 billion plan by Thailand to carve a canal through the Kra peninsula, linking the Indian and Pacific oceans' sea trade routes, could cut millions of dollars off the cost of doing business in East Asia.
The Thai Senate is due to vote in its next session on a study of the 120-kilometre canal, which would join the Indian Ocean with the Gulf of Thailand...
Senator Kamnuan said Malaysia and Indonesia had expressed interest in investing in the project. China had also indicated support during unofficial talks in December 2001...

US concerned at China's 'string of pearls' military plan - Daily Times, January 19 2005
[This is another recent mention the Kra Isthmus Canal as part of China's military plans.]
...The "string of pearls" strategy, as the report calls China's move, includes a new naval base under construction at the Pakistani port of Gwadar, naval bases in Myanmar, a military agreement with Cambodia, strengthening ties with Bangladesh and an ambitious plan under consideration to build a 20-billion-dollar canal in Thailand to bypass the Strait of Malacca.
The activity has raised concerns at the Pentagon that China's military build-up, which is taking place faster than earlier estimates, is aimed to project force and undermine US and regional security...

Krabi-Khanom Land Bridge - translated and summarized from Transport Journal, March 1-7, 2004
[Ed.: This type of project is thought to make the need for a Kra Istmus Canal obsolete.]
This project was approved on June 22, 1993 and will consist of a 4-lane highway (Highway 44), with 160 m in the center to carry the railway tracks and pipelines. This land bridge is initially started from Ao Luiek district of Krabi and ended up at Kanchanadit of Surat Thani. However, the environmental concerns at Krabi as well as Samui have compelled the government to move the terminal from AO Luek (Krabi) to Ban Thup Lamu (Phang Nga) and from Kanchanadit (Surat Thani) to Ban Bang Por, Sinchon District of Nakhon Srithammarat with the total distance of 220 km. Now, Highway 44 is done, but the railway track has not been laid yet.
The railway stations will have 50 m space along the track and 100 m x 1500 m for the stations. Initially, it will be single track for standard gauge (1.435-m). There will be 5 stations:
1) Khanom (Ban Bang Por)
2) Ban Na
3) Plai Phraya (Krabi Industrial Estate)
4) Thup Pud
5) Ban Thup Lamu
The construction cost of this track will be 19.8 billion baht (90 million baht/km)--land expropriation not included.
Nevertheless, SRT is asking the government to approve the funds for the meter guage--Khirirat Nikhom - Phang Nga - Thanun--which has been frozen since 1956. It also asks that the main deep sea port should be located at Thup Lamu since it is about 5 km from the proposed track while the deep sea port at Khanom is 40 km from the rail track.
Even though there is a proposal to lay the pipeline and set up the refinery on both sides of the land bridge, it has not been executed yet because of environmental issues.

Millions of Chinese laborers on their way to Thailand? - Asia Today, January 20, 2004
Pas points out a bizarre and utterly insane article on the Kra Canal from Asia Today: Beijing sees the [Kra Canal] project as of some national importance to its own economy - namely, the deployment of millions of workers who will likely be unemployed on completion of the massive Three Gorges dam project later this decade.
China's demand for oil: ....the reality of a Kra Canal being built is fast taking shape following the collapse of a top-level US$2 billion pipeline deal to move oil from Russia to China. The pipeline would have carried up to 20 million tons of oil each year from Siberia to China, now the second-largest oil consumer in the world. Presently, the Straits of Malacca is the most important waterway in the world, and most of China's and Japan's oil imports pass through it. But the Straits has a growing problem with piracy. The Philip Channel near Singapore is only 12.5 km wide - a natural bottleneck with the potential of a collision, or worse, a terrorist attack. ....if a large oil tanker sank in the Philip Channel, other vessels could be forced to take a long detour, holding up oil imports to China and Japan for weeks. China reportedly has just seven days of oil in reserve.
Chinese to deploy its labor to build the project? The US building a permanent base in Sri Lanka and wanting getting faster access to Guam? Thaksin privately in favor of it? How credible is this?
Ed.: Like most articles in the international press about the Kra Canal, this one starts with phrases like "first mooted in 1677" and goes on to be a collection of warmed over musings gleaned from old studies. As far as we know, Thaksin's only connection to the project was as a plum to entice the now-defunct New Aspiration Party (a party that existed to gain control over big money projects like the airport, Hopewell, Kra Canal, etc. through the Interior Ministry) to be part of the ruling coalition. The last time the New Aspiration Party dealt with the canal, the strange goings on thoroughly discredited the project. Anyway, the article ignores the landbridge project that is to supersede the canal. Next time Asia Today should check out 2Bangkok.com before printing such rubbish.


Building of Tavoy road to start soon - Bangkok Post, December 8, 2003
...Mr Pattana said the new road would help tourism in Kanchanaburi and the transport of goods to the deep-water port at Tavoy. Exporters would not need Singapore port or the Kra canal project.


Cabinet to rule Oct 16 on Kra canal study - Bangkok Post, October 7, 2003
The fate of the stalled Kra canal feasibility study will be decided on Oct 16 when cabinet meets to assess the project's second anniversary.

Southern landbridge - Final evaluation ready next year - Bangkok Post, October 6, 2003
The evaluation of the landbridge project linking the Gulf of Thailand and Andaman Sea will be concluded by early next year, Deputy Prime Minister Visanu Krue-ngarm said... The landbridge would turn the country into an oil-trading centre in Southeast Asia, Mr Visanu said. A pipeline would be laid to link the Andaman Sea and the Gulf. Two oil depots and one refinery would be built, and a petrochemical industry established.
This is a project that would probably forever remove the need for a Kra Canal.


The "land bridge" to replace the Kra Canal
- translated and summarized from Thasetthakij, September 25-27, 2003
The proposed land bridge route has been moved from Krabi to Thab Lamu commune, Thai Muang district of Phang Nga (the area belonging to Phang Nga Naval Base) and from Khanom district of Nakhon Srithammarat to Sichon district of Nakhon Srithammarat due to the fact that the land bridge would ruin tourists spots in Krabi. The proposed land bridge will cut oil transportation expense by 7 billion baht a year.
Commentary by Wisarut: The land bridge is a substitute for the Kra Canal. However, the route to Phuket is another matter since it is just the extension of the line from Surat Thani which was terminated at Khirirat Nikhom District of Surat Thani in 1956 (after being proposed in 1938) and not going all the way to Tha Num in Phang Nga though.
So far, only a local train which runs once a day between Surat Thani and Khrirat Nikhom uses this route. If the line to Tha Nun is completed, SRT will implement an express to Tha Nun instead of a local train. If they can extend to Tha Num, SRT will consider extending the route all the way to Phuket via the bridge parallel to Sarasin Bridge (the only bridge connecting Phuket with the Mainland). [Yesterday we ran a
Poison pen letter from SRT, accusing the SRT selling land in Phuket that was reserved for a future Phuket station.]

A pro-canal article - Pacific News Service, July 22, 2003
Rapee Boonplueang points out: China's Demand for Oil May Make Thailand Canal a Reality.
...giant China wants to build a canal through Thailand as an alternate way to ship oil... Articles have already appeared in China with headings entitled "Abandon the Malacca Straits and build the Thai Kra Canal." And a subtitle says, "This is shaking Southern Asia."

Tired Charoon to step down - Lashes out at `unfair criticism over funds' - Bangkok Post, July 16, 2003

Financial mess triggers call for Charoon to quit national panel - Bangkok Post, July 15, 2003
The embarrassing Kra canal saga - July 7, 2003
The question of whether a canal is viable or not continues to be a moot point as the continuing murky subject of the expensive study drags on: Project manager resigns - Concerns raised over fund mismanagement - July 6, 2003
PPP was awarded the contract on Jan 17 by the national committee to conduct a feasibility study into digging a canal in the South to link the Gulf of Thailand and the Andaman Sea. The firm presented the committee with a US$1 million cheque and promised to pay another US$49 million by late June to cover expenses.

The incorporation papers of Phuket Pass Project Limited
However, the firm has so far failed to keep its financial pledge since no money has been handed over. ACM Charoon's move to deposit the money under direct control of the Klong Thai Foundation surprised members of the national committee, since the foundation was not directly supervised by the committee. "This is quite unusual since only foundation members are aware how the money is used but not the committee members," said a committee member...
The ex-air force officer said the study could not get started because PPP was still unable to deliver its financial pledge. "We cannot do anything about this except wait until we get the money. PPP said it had some problem but did not elaborate what the problem was," said ACM Charoon, who played a crucial role in awarding the contract to PPP in January.


Incorporation papers of the Phuket Pass Project Limited

Phuket Pass can't pay on time - Bangkok Post, March 14, 2003
...the Hong Kong-based firm failed to hand over the money yesterday as promised. It earlier failed to deliver the $4 million second payment on March 3 and the chairman, Adisak Techa-adisak, then promised to pay the full $49 million owed on March 13...

Money for canal study to be paid on March 13 - Bangkok Post, March 10, 2003

Phuket Pass to pay up soon - Bangkok Post, March 6, 2003
...Phuket Pass paid $1 million into the study fund when it was awarded the contract on Jan 17. The cheque was made out to the Klong Thai Foundation, which was to be set up to manage the financing but has still not been registered... Earlier: Kra Canal study firm fails to provide money - Bangkok Post, March 4, 2003

Finding out about Phuket Pass Project Limited - February 15, 2003
Phuket Pass Project Limited is the company that was given the contract for the expensive study of the Kra Canal Project. It first surfaced in the news on August 8, 2002 when it was reported the company would receive the canal study project. The Companies Registry in Hong Kong now informs 2B that this was less than one month after the company was incorporated: ...Phuket Pass Project Limited (CR No.: 805288)... was incorporated as a limited company in Hong Kong on 10 July 2002 and is still on the register of companies maintained by this Registry as at the date hereof. After protests from other companies bidding on the study, the issue disappeared from the news until January 2003, when it was again announced that Phuket Pass Project Ltd. would be doing the study. Phuket Pass Project Limited's chairman is Adisak Techa-adisak and the other founding members are Ho Tung Chan Don and Leong Weng Jee (Leong Wangkee), both Singaporean. Some sources also name a "Sakae Torisawa" as a director. UPDATE: Incorporation papers of the Phuket Pass Project Limited

Phuket Pass Project Ltd - The Bangkok Post, January 22, 2003
Phuket Pass Project Ltd. is the company doing the Kra Canal study. Anyone heard of it before? How long has it been in business? There's no mention of it on the net or in the archives of local newspapers. According to the article it was financed by interests in Australia and Japan. It was registered in Hong Kong, but its office was in Thailand....ACM Charoon denied that his committee had tried to keep secret the contract signing with Phuket Pass Project. Gen Chavalit said the money was clean. 'The company wrote the agreement together with the Office of the Attorney-General.''


Another study on the Kra Istmus canal - Bangkok Post, January 21, 2003
Deputy Prime Minister Chavalit Yongchaiyudh's pet project, the 25 billion dollar Kra Isthmus Canal, got a boost when a new feasibility study got underway: The contract was signed between the national committee in charge of the study and Phuket Pass Project Limited during a ceremony chaired by Gen Chavalit, said Deputy Transport Minister Pichet Sathirachawal. Phuket Pass Project director Sakae Torisawa gave Gen Chavalit a cheque of US$1 million as advance payment.

Spending US$50-100 million to study the Kra Canal - August 10, 2002
Controversy over just who is funding Kra Canal studies--a mysterious company call "Phuket Passproject Co Ltd, a Hong Kong-based firm" would do the study and then get to approve all future investors in the project--the article also mentions that a ``modest'' estimate of the cost [of the Kra Canal] was put at 800 billion baht...

Malaysia backs canal go-ahead - Bangkok Post, May 10, 2002
....The canal would be good for the region, even though Malaysia's own port business would suffer if it went ahead, Mr Mahathir told him.... The project, which has been on and off the drawing board for many decades, became Gen Chavalit's political canvassing manifesto.... Chinese and Malaysian firms were keen to invest in the project, which was expected to take seven years and cost 800 billion baht. The feasibility study alone is costing the government 1.8 billion baht. (from The Bangkok Post, May 11, 2002)


June 21, 2001 - A new study is being comissioned on the canal. (The Nation keeps changing its directory structure, so the link to this article keeps getting broken.)

KRA CANAL PROPOSAL: Revival of dream urged
Ministry says full feasibility study should be launched
The Nation, September 8, 2001, full article online

The proposal to dig the Kra canal is to be dusted off and forwarded for Cabinet consideration next week, an official source said yesterday.

The committee that screens proposals from the Communications Ministry for Cabinet consideration will push for the digging of Kra canal as part of efforts to solve the economic troubles facing the country.

The ministry requested that the Cabinet commission a full feasibility study - not just a pre-feasibility study - saying that a complete range of views about the pros and cons of the digging of the canal should be sought.

The Kra canal, a grand project that has been talked about for centuries, would bisect the south of Thailand and connect the Indian and Pacific oceans.

The Foreign Ministry commented that the study should cover the project's impact on maritime commerce and international law.

The Science Ministry stated that an environmental-impact assessment must be carried out thoroughly and that public hearings must be conducted across the country to get the public's view of the project.

The Budget Bureau said that the institution that carried out the study needed to be widely trusted by the public in order to prevent social conflict. The National Security Council agreed that only careful research would prevent disputes that might occur with interest groups.

The National Economic Social Development Board said the study should focus on the facts relating to international trade and investment, maritime business, maritime transport and economic geography.

The Finance Ministry commented that a special committee comprising all agencies involved should be set up to study all points relating to the digging of the canal.

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One Response to The Kra Isthmus Canal News 2001-2003

  1. Falk Ohlig says:

    Ladies and Gentlemen, sawadikap,

    My name is Falk Ohlig and I lived in Bangkok from 1995 until 2002. I was Far East Representative of the German company Thyssen Krupp with my office in the Empire Tower in Bangkok, during that time in the floor 15th (nowadays it is floor 30).

    During my very sucessful time in your nice country, privately and businesswise, I was also member in the Kra Canal Commitee. As I`m be next month from the 6th of August for appr. 2 weeks in Bangkok again for vacations I asked whether this Kra Canal Committee still excist? I would like to spend in this case to these engaged people a visit too. I arranged during my time in BKK some trips to the Kiel Canal in Germany and I try to give within my possible visit an update for future actions.

    Is it possible that you could give me corresponding contact person with e-mail, telephone, adress etc. in order to contact these persons from my side directly, if required.

    I`m looking forward to your positive answer with

    My very best regards from the Hanseatic City of Lübeck in Germany

    Yours
    Falk Ohlig

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