Interview: Pailin Chuchottaworn
While Thailand’s energy demands continue to increase with limited domestic resources, where do you anticipate energy investments taking place?
PAILIN CHUCHOTTAWORN: With respect to the upstream oil and gas sector, we anticipate continued investments in exploration and production (E&P) activity across Thailand, particularly in owned petroleum sources to augment existing reserves. We also expect there to be a broader expansion of petroleum exploration sources as the upstream industry attempts to secure outlying reservoirs to exploit. In this respect, the 21st bidding rounds to be held in 2014 will be of particular interest to the industry. Many of the larger players involved in E&P will continue to invest heavily in enhanced recovery techniques to maximise production. In PTT Group’s case, we are working to sustain domestic production at 250,000 barrels per day (bpd) until 2020.
These developments in the upstream sector will likely be supplemented by the expansion of gas pipelines to improve regional connectivity to better meet domestic demand, of which PTT will be playing a major role. In terms of power generation, PTT Group in partnership with players from the public and private sectors will execute significant investments in independent power producers, small power producers and combined-cycle plants to promote the continued improvement of Thailand’s power-generation capacity.
Do you consider foreign expansion a short-term or long-term solution for Thailand’s energy crunch?
PAILIN: Expansion abroad, particularly in the ASEAN region, will be vital component of Thailand’s national energy strategy to meet both short-term and longterm objectives for the country. In this respect, PTT Group has developed a framework for assessing regional opportunities to determine a harmonised approach to ASEAN-focused expansion. Over the short to medium term, we have assessed Myanmar and Indonesia as countries of focus in light of the breadth of opportunities presented in their respective energy sectors. Indonesia holds vast potential through the exploration of the East Natuna project and participation in future E&P bidding rounds, mergers and acquisitions, and greenfield investments in the country’s coal mines, as well as the development of refineries and petrochemicals facilities in the country.
In the case of Myanmar, opportunities in the lubricants market, refinery improvement programmes and investments in hydro and gas-fired power plants, can be harnessed to develop the country’s overall energy infrastructure and market growth.
What are the benefits of investing in the upgrades of Myanmar’s oil refineries and electrical systems?
PAILIN: Myanmar’s power consumption sits at around 3000 MW, which is only one-ninth that of Thailand’s. Yet, demand for power in the country is soaring. As international investment pours into Myanmar, new pressures are being felt on the country’s power market. There is tremendous potential for investment in Myanmar’s power infrastructure, along with the refineries that are struggling to support domestic demand for crude oil products. PTT Group will assist the Myanmar Petrochemical Enterprise in upgrading an existing 50, 000-bpd refinery. Studies are also being conducted on the development of four power-generation facilities. Meeting the domestic energy requirements of Myanmar will be crucial to the country’s development objectives.
In this respect, PTT Group has an important part to play in assisting with the upgrade of Myanmar’s energy market and infrastructure. Through developments such as these, Myanmar’s growth will accelerate, helping to produce a more prosperous and effective economic relationship for both countries. Promoting a closer, more integrated energy relationship between Thailand and Myanmar will therefore also be a vital component in the broader necessary process of diversifying Thailand’s energy mix. In this way, PTT Group is playing an important role in terms of regional development as well as securing Thailand’s energy future.