LNG

One of the oldest registered companies in Thailand is making progress on developing its liquefied natural gas business with more imports while expanding its power business domestically and in Southeast Asia and elsewhere as earnings were hit by the rising natural gas price.

PTT Group, the national energy company of Thailand, has started a joint venture with Tokyo Gas to help with fuel switching in the southeast Asian nation, including small-scale truck deliveries of liquefied natural gas.

Thailand’s energy exploration and production company PTTEP, a shareholder in Mozambique LNG, has announced a second successive natural gas discovery at a field in Malaysian waters offshore Sarawak as the nation also aims to expand LNG imports because of growing power and industrial demand.

Thailand’s Electricity Generating Public Company (Egco) has applied to the state regulator for a licence to import liquefied natural gas, making it the sixth company to be on the country's list for more LNG supplies.

Egco submitted the application to the Thai Energy Regulatory Commission (ERC) for permission to import 250,000 tonnes per annum to fuel three gas-fired power plants.

The company said the power plants included the 256-megawatt Banpong plant in Ratchaburi, the 121MW Klongluang facility in Pathum Thani and the 120MW co-generation plant in Rayong province.

Egco said the Banpong and Klongluang plants could use additional supplies. They already have an existing sales agreement with Thai state oil and gas company PTT, previously the nation’s sole importer of LNG.

“In the long term, the company may coordinate with other LNG shippers to make purchases through the same contracts when global LNG prices are declining or when demand for gas in Thailand declines,” said Egco.

The four other LNG import licence holders are the state’s Electricity Generating Authority of Thailand (EGAT), Gulf Energy Development, Hin Kong Power and B.Grimm Power.

PTT previously had a monopoly on imports until EGAT was given an LNG import licence in 2019.

The Egco group has a total of 28 power plants in Thailand and in other Asian countries, including Laos, the Philippines, Indonesia and Taiwan.

Its existing plants have total contracted capacity of around 5,475 megawatts, while three others are under construction with total capacity of 331MW.

Egco, which is listed on the Stock Exchange of Thailand, saw its earnings hold up despite the challenges of the Covid-19 pandemic.

The company posted third-quarter net profits of 2.26 billion Thai Baht ($74.9M) compared with 2.82Bln baht ($93.25Bln) in the same three months of 2019, a decline of around 19.5 percent.

Third-quarter revenues amounted to 9.83Bln baht ($325M) versus 10.71Bln baht ($353M) in the prior-year quarter.

The new LNG importers will be accommodated by the expanded capacity at the Map Ta Phut LNG import terminal in Rayong that has been operating since 2011.

PTT has completed several expansions at Map Ta Phut with the most recent from 10.7 MTPA capacity to 11.5 MTPA.

A second regasification terminal adjacent to Map Ta Phut and called Nong Fab LNG is expected to be completed in 2022 with total regasification capacity of 7.5 MTPA. 

The oldest industrial conglomerate in Thailand, the B. Grimm Group, has become the third independent company to receive a liquefied natural gas import licence as the sector is liberalized.

The B. Grimm Group said in a statement to the Stock Exchange of Thailand that it had been awarded a permit to import 650,000 tonnes per annum to the Map Ta Phut LNG import terminal in Rayong province.

Two other companies, the power producers Gulf Energy Development Public Co. and Hin Kong Power, have previously been awarded licences to import a combined 1.7 million tonnes per annum.

Thailand’s national oil and gas company, PTT, had previously been in the only importer to the Map Ta Phut regasification facility, which has storage capacity for 11.5 MTPA of LNG.

A second LNG terminal adjacent to the existing Map Ta Phut facility with a capacity of 7.5 MTPA is under construction and is expected to start operations by 2022.

A third Map Ta Phut expansion is also in the design phase, undergoing a feasibility study.

The Thai B. Grimm Group has been operating in the country since 1878 and the LNG licence was first applied for by the B. Grimm Power Co. subsidiary in 2016.

Preeyanart Soontornwata, the President of B. Grimm Power, said the company planned to use the LNG acquired through the licence to fuel five gas-fired small power producer (SPP) plants under construction.

SPP plants in Thailand sell electricity to the state grid at up to 90 megawatts, while the remaining capacity can be sold to private buyers through a private power purchase agreement.

The five Grimm Group plants, all in the Eastern Economic Corridor, had their concessions renewed by the Energy Regulatory Commission earlier in 2020.

“B.Grimm acquired an LNG Shipper licence from the ERC in the amount of 650,000 tons per year for supplying the LNG to the company’s combined cycle power plants from 2022,” said that statement from the company President, Mrs Preeyanart.

“The use of LNG is expected to support fuel cost management for electricity generation,” she added.

Gulf Energy Development said its licence awarded earlier would be used to supply LNG to 19 of its small-scale power plants.

The company said in a separate statement that Hin Kong Power also won a licence as part of a joint venture with Gulf Energy.

The LNG licence awards come as Thailand plans to boost imports with a new terminal near the single operating facility at Map Ta Phut, which last year imported 5 MTPA of LNG, mostly from Qatar and Malaysia.

The 5 MTPA of imports was still 14 percent more than the previous year when 4.4 MTPA was delivered.

Gulf Energy Development, a leading Thai power supplier to the Electricity Generating Authority of Thailand (EGAT) and private customers in the country’s main industrial zones, has been awarded government licences along with a partner company to import 1.7 million tonnes per annum of LNG.

Thailand’s state oil and gas group PTT has named Auttapol Rerkpiboon to be the next President and Chief Executive with a strategy for 2020 to start boosting its presence in the liquefied natural gas business as an importer and eventually a regional trader.