PTT to set up Bt26-bn natural gas subsidiary

PTT Plc plans to invest more than Bt26 billion in a deep-sea port, terminal and pipeline for liquefied natural gas (LNG), according to president Prasert Bunsumpun.


PTT LNG Co Ltd has been set up specifically to handle the project. Initially, PTT will invest 100 per cent in the new company.


"Electricity companies could take up a 40 per cent stake later - probably the Electricity Generating Authority of Thailand, Electricity Generating Plc or Ratchaburi Electricity Generating Holding Plc," said Prasert.


The LNG-receiving project, consisting of the depot and terminal, is scheduled for completion in 2010, with an initial capacity to handle 5 million tonnes of gas a year. Capacity could be increased to 10 million tonnes later.


Yesterday, PTT signed an agreement with the Industrial Estate Authority of Thailand that allows PTT to develop the LNG port on a 755-rai area in the second phase of Map Ta Put Port in Rayong for 30 years.


PTT has already signed a contract to buy 3 million tonnes a year of LNG from Iran, which could be shipped early in 2011. The company is also in talks with other countries, including Australia, to buy another 2 million tonnes of LNG a year.


Prasert expects the project to meet the rising domestic demand for gas, which is expected to grow 12 per cent a year over the next five years.


The company will also spend more than Bt15 billion to build a pipeline to deliver LNG to power plants in Nakhon Ratchasima province, said executive vice president Chitrapongse Kwangsukstith.


Power plants will receive 60 per cent of the LNG from the terminal, while the rest will go to industries such as the automobile industry, he said.


PTT also plans to build its seventh and eighth natural gas separation plants at Map Ta Put to help the Thai petrochemical industry. They are scheduled to be completed by 2011 and 2012 respectively.


The combined capacity of the plants will be around 800 million standard cubic feet per day. Chitrapongse declined to reveal the investment budget.


Prasert added that PTT would wait until Monday before making a decision about raising retail oil prices.


As of yesterday, Dubai crude oil and finished oil in Singapore rose US$1 (Bt38) per barrel to $68 and $86 respectively. The increase pulled down the average marketing fee of all oil products to 40 satang per litre.


Prasert said that the petrol marketing fee was near the negative range, while the diesel marketing fee was slightly positive.