Thais to scrap Cambodia oil deal in Thaksin row

The government in Bangkok also warned that it could seal the border between the two countries, one day after the neighbours both recalled their respective ambassadors due to the dispute over Thaksin's appointment.

Thai Foreign Minister Kasit Piromya said Bangkok had decided to cancel a 2001 agreement to jointly develop a disputed area in the Gulf of Thailand, which was signed during Thaksin's time in power.

(...) "The Foreign Ministry has decided to terminate the memorandum of understanding between Thailand and Cambodia to develop the overlapping area which was signed by the Thaksin government," Kasit said.

Kasit said the oil and gas exploration deal for a 26,000-square-kilometre (10,038-square-mile) area had made no progress in the last eight years and he would propose to the cabinet on Tuesday that it should be scrapped.