Cambodia PM says offshore oil potential unsure

Prime Minister Hun Sen said Wednesday that there is still uncertainty about the commercial viability of Cambodian offshore oil deposits, qualifying his earlier optimism over their potential.

In February, Hun Sen raised hopes of a brighter future for his impoverished nation when he said Cambodia expects to begin tapping oil revenues in 2010.

"Whether it will be a curse or blessing, in fact it is still under the seabed, and it is still unknown how much there is," he said Wednesday.

"What if one day companies say, 'Oh, no, after exploration, it has no commercial viability?' Oil under the sea is still a dream," he said.

Hun Sen spoke during a ceremony to begin construction of a Chinese-funded bridge at a village about 20 kilometers (12 miles) north of the capital Phnom Penh.

China is among several countries that have lined up for opportunities to explore oil off the coast of Sihanoukville, in Cambodia's southwest.

U.S. energy giant Chevron Corp. discovered oil in 2005 off the Cambodian coast, 145 kilometers (90 miles) southwest of Sihanoukville. The company found oil in four wells in an area called Block A, and plans to drill 10 more wells by the end of 2007.

Critics and observers have expressed concerns that increased income from oil could exacerbate Cambodia's already widespread corruption if the government fails to develop proper legal environment to manage the expected revenues.

Hun Sen said Wednesday he is fed up with that point of view, and that "it is better to think about how to maintain growth of the current economy."

In a statement issued Tuesday at the end of a mission to Cambodia Tuesday, an International Monetary Fund delegation warned that there is still much uncertainty about whether Cambodia will become a significant oil producer.