LNG

Thailand’s state-run exploration and production company PTTEP, which has stakes in Malaysian floating LNG and a Mozambican LNG project, reported almost 40 percent of growth in earnings in the first nine months due to higher natural gas output and prices.

PTTEP of Thailand, the oil and natural gas producer, has reduced its spending plans for the rest of 2020, though would remain on track with key investments in projects such as Mozambique LNG and development of the company’s largest ever southeast Asian natural gas discovery in the Lang Lebah field offshore Sarawak.

PTTEP, whose official name is Exploration and Production Public Company Ltd, noted in its latest newsletter to shareholders that it had adjusted investment plans to cope with the impact from the Covid-19 pandemic that suppressed domestic energy demand.

PTTEP said its 2020 expenditure has been reduced by 15-20 percent with some exploration activities deferred, while maintaining reasonable capital expenditure levels to ensure the continuity of the energy supply of the country.

In the LNG sector, PTTEP has an 8.5 percent stake in the Area 1 licence of the Rovuma Basin offshore Mozambique in southeast Africa.

Part of the overall stake, about 26 percent, was transferred to French major Total from Anadarko Petroleum of the US as a side-deal to the Occidental Petroleum takeover in 2019 of Anadarko.

PTTEP in 2019 also made a Malaysian acquisition from Murphy Oil of the US, including a large stake in the Rotan natural gas discovery offshore Malaysia, which is subject to a floating LNG joint venture.

“PTTEP will continue with investment in development projects such as Mozambique Area 1 and additional drilling activity in the Malaysian Lang Lebah gas field in Block Sarawak SK410B, to ensure the first production of these projects in the next four years as planned,” stated the Thai company.

PTTEP’s Lang Lebah gas field is the largest commercial discovery of petroleum resources it has ever made in what was its first exploration well at the Sarawak SK410B Project just over a year ago.

The natural gas discovery at Lang Lebah-1RDR2 encountered 252 metres of net gas pay and has an estimated several trillion cubic feet of gas in place.

The SK410B project is located in shallow waters about 90 kilometres offshore Sarawak in PTTEP acreage of around 1,870 square kilometres.

PTTEP in its post Covid-19 and oil crisis review revised downwards its overall estimated sales volume in 2020 to 362,000 barrels of oil equivalent per day, a decrease of 7 percent overall from the previous target.

However, the company said it was staying on track with its current investments and was also ready to spend on expansion.

“After the oil price crisis, PTTEP is ready for investment opportunities as we follow our strategic expansion plans that emphasize Southeast Asia where we have built expertise and experience and in the Middle East,” said the company.

PTTEP said it had expanded investment in Thailand, Malaysia, the United Arab Emirates and Oman for short and long-term gains as well as acquired projects that immediately generate income.

The company was also prepared for digital transformation through investment in new businesses that will enhance technical performance.

“Through these strategies, we aim to achieve solid growth and maintain Thailand’s energy security in the long term,” said the company.

The PTTEP update also included a mention of the company’s celebration of its 35th anniversary.

A ceremony was held at PTTEP headquarters in Bangkok to mark its founding in 1985 with the mission as a state-owned petroleum exploration and production enterprise to strengthen national energy security.

The event was attended by senior board members and executives.

They were led by Prajya Phinyawat, Chairman and Head of the Independent Directors Committee of PTTEP, Tongchat Hongladaromp, Advisor to the Board and former PTTEP President, as well as Phongsthorn Thavisin, the current President and Chief Executive.

Thailand national energy company PTT Exploration and Production (PTTEP), whose LNG assets include a stake in the Mozambique LNG export project in Area 1 of the Rovuma Basin, reported a 23 percent jump in first-quarter net income as it secured more exploration acreage and a floating LNG stake in Malaysia.

Thailand is securing its domestic production of natural gas in the Gulf of Thailand, as well as its pricing, while expecting more LNG volumes from Mozambique and elsewhere and constructing a new LNG import terminal.

Thai state energy company PTT Exploration and Production (PTTEP) said its development subsidiary was on track to take over operatorship from Chevron Corp. of the Erawan natural gas field in the Gulf of Thailand and has proposed a consumer price to the government equivalent to $3.70 per million British thermal units.

PTTEP takes over the Erawan field in 2022 to add to its operatorship of the nearby Bongkot natural gas field.

“The company is confident that its proposals will deliver benefits to all parties and ensure energy security to the country,” said Phongsthorn Thavisin, PTTEP President and Chief Executive, after the signing ceremony just held for the Production Sharing Contracts (PSCs) for the G1/61 field (Erawan) and the G2/61 field (Bongkot).

“The continuity of natural gas supply is the top priority of the government and the operators, we believe, as the benefits will be brought directly to the country and the Thai people. The state agencies are determined to smoothly proceed the transition of operations and we have already prepared for this process,” added the CEO.

For its LNG supplies, PTTEP is a 10 percent shareholder in the Area 1 licence of the Rovuma Basin offshore Mozambique held by Anadarko Petroleum of the US.

The Thai company said the first phase of LNG production in the southeast African nation is planned for 2024 with initial volumes of 12 million tonnes per annum.

Thailand is planning a second import terminal not far from its existing import facility at Map Ta Phut in the eastern province of Rayong.

The new Nong Fab terminal will have a maximum receiving capacity of 9 MTPA.

PTTEP said initial investments in the Gulf of Thailand domestic production would be around $320 million and would ensure production volumes from both fields.

The company plans to safeguard production volumes in the Bongkot and Erawan fields of at least 700 million cubic feet per day and 800 million cubic feet per day respectively.

The investment includes the drilling campaign of the exploration and production wells and the construction of additional wellhead platforms.

“From 2022 onward, about 80 percent of the natural gas production in the Gulf of Thailand will be under our operations,” said Phongsthorn.

“This means PTTEP will become the largest producer of natural gas in the country, demonstrating our success in carrying out the mission to establish energy security to Thailand,” he stated.

Phongsthorn explained that commitment in the PSC will benefit the state, the Thai people and the future revenues of PTTEP.

The CEO said a price constant of 116 Thai baht per MMBtu ($3.70 per MMBtu) had been proposed to the government.

“This is reasonable and will bring benefits to the state and the Thai people,” he added.

“Having the Erawan field in its portfolio will contribute higher gas production volumes as well as increased revenues for PTTEP,” he added with expectations of bringing down the operational costs by between 20 percent and 25 percent.

“Through the comprehensive analysis, we are confident that our proposals submitted in the bid will create mutual benefits to all relevant parties,” he stated.

The United Arab Emirates, the LNG producer that is expanding its natural gas and oil exploration in Abu Dhabi, has signed two concession agreements with Italian energy company Eni and its joint venture partner from Thailand, PTT Exploration and Production Company.

Jan 1 (LNGJ) - The Thai energy company, PTT Exploration and Production, said it planned to invest 16.17 billion Thai Baht ($490 million) to support the final investment decisions in key projects during 2019, including the Mozambique LNG joint venture in Offshore Area 1 of the Rovuma Basin as well as other foreign projects in Algeria and Vietnam. “During 2019 PTTEP will move forward through a more active strategy, including in the Gas Value Chain business,” said Phongsthorn Thavisin, PTTEP Chief Executive. He added that total capital expenditure during the year would be around $3.25 billion.