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Agricultural Development Bank of China
InfoQuest

Thai energy minister asks PTT finish HUB LNG within 2 months to deliver first batch of LNG to China in early 2020

October 12, 2019


Abstract : Thai energy minister Mr. Sonthirat Sonthisajirawong revealed that during his visit to Chonburi operation center of Petroleum Authority of Thailand (PTT), he asked PTT to hammer out the HUB LNG plan within two months and work with relevant departments to carry out the plan.

Friday, October 11, 2019

Thai energy minister Mr. Sonthirat Sonthisajirawong revealed that during his visit to Chonburi operation center of Petroleum Authority of Thailand (PTT), he asked PTT to hammer out the HUB LNG plan within two months and work with relevant departments to carry out the plan. The implementation of the above-mentioned plan will mainly fall on PTT and the plan will involve more than one LNG importers. The plan aims to use Thailand's powerful natural gas industry and competitive energy cost to boost stable development and enhance overall competitiveness.

"Once receiving the plan, the Ministry of Energy will deliberate on it and work out policy documents to submit to the National Energy Policy Committee (NEPC) and get the plan implemented. The implementation of the above-mentioned plan will mainly fall on PTT. Yet details of specific proportions have not been determined before clear-cut policy being issued," said Mr. Sonthirat.

According to the Energy Minister, currently Thailand owns a complete, sound and stable production and management system in natural gas industry; as an importer of LNG for fuel procurement in the future, Thailand has infrastructure such as LNG warehouse to support the country to grow into a regional LNG leader. Therefore, Thailand must move faster to implement the plan and to dominate the industry region-wise.

The sustained demands of ASEAN region for LNG offer Thailand opportunities to export moderate amount of LNG to CLMV states via shipping or land traffic.

According to PTT's CEO and President Mr. Chansin Treenuchagron, PTT is well-prepared to implement the plan; as an industrial player with 40 years of expertise, PTT owns warehouses capable of receiving/sending 11.5 million tons of LNG, including the Nong Phaeng LNG warehouse under construction, which has a storage capacity of 7.5 million tons/year and is expected to complete in 2022; once completed, it will enable PTT to receive/send 19 million tons of LNG each year. PTT also plans to build new warehouses in Phase III development project of Map Ta Phut industrial port. It is believed that those warehouses will meet storage demands in 10-15 years, and make it no necessary to expand storage capacity in the same region.

Yet it is still necessary to build FSRU-type floating LNG warehouses. But the specific plan should be worked out by the government according to the building policy for new power plants in the region.

According to Mr. Wuttikorn Satithit, natural gas EVP at PTT, said that it is estimated that only a little investment is enough for LNG trade and operation. That is because investments have been made to build infrastructure and professional personnel are available. What should be added are management fees, which should not be too complicated. Before sending LNG to Chinese clients, PTT will conduct systematic tests late this year, and deliver the first batch of LNG via small-lot shipping.

He pointed out that since Thailand boasts complete infrastructure and is the first ASEAN country that has imported LNG in large amount, the country enjoys advantages in LNG.

According to Mr. Atikom Terbsiri, a chief operating officer at PTT taking charge of upstream oil and natural gas business, said that PTT currently owns warehouses capable of supporting the import of 11.5 million tons of LNG; since the beginning of this year, PTT has only imported 4 million tons of LNG; according to the signed long-term contract, it has to import 5.2 million tons each year; now it has three months to finish the remaining amount. It is estimated that Thailand's overall demands for LNG will not increase too much, namely about 4.8 billion cubic feet/day, close to the 4.6-4.7 billion cubic feet/day last year.

Thailand is seeking to become a HUB LNG in ASEAN region, which will add to the current receiving/sending capacity of existing LNG warehouses. Besides, CLMV markets are using LPG or diesel as fuel; as clients with factories within small coastal industrial parks or border areas are potential LNG clients, PTT will expand market and use LNG to replace the above-mentioned fuels; PTT has rich experience in this aspect, since it currently owns about 400 industrial clients using LNG as fuel, which consume about 250 million cubic feet of LNG each day.

Chonburi operation center features PTT Natural Gas Pipeline Knowledge Hall, and is used to showcase natural gas pipeline system.

Source: InfoQuest, by Wilawan Pongpitak/ Sasithorn, translated by Xinhua Silk Road

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