Published on June 24, 2005

PTT Plc said yesterday the planned 40-per-cent cut in water supply at the Map Ta Phut Industrial Estate would have little impact on the operations of its subsidiaries or affiliates at the Rayong estate.

“Such measures will not have any impact on refineries, gas separation plants, power plants or infrastructure for industry and general consumption,” PTT said in a filing to the Stock Exchange of Thailand.

The company made the claim a day after Siam Cement Plc announced that its plants would cut production by 40 per cent later this month.

In the filing, PTT highlighted short-term and long-term measures to ensure sufficient water supply and normal operations. The industrial estate asked all operators to cut water consumption by 40 per cent from Monday to save available raw water until the end of July.

In the short term, the group will buy water from other sources and ship it to Rayong “in order to sustain the production at a near normal level and reduce the impact on PTT group caused by the water shortage,” PTT said in the statement.

PTT group assured its customers of a continuing supply of water and said the company would give special priority to supplying products in the petrochemical and power sectors by coordinating closely with customers to reduce the impact from water shortages.

In the medium term, the group plans to jointly invest in a water pipeline and construction of additional wells to stretch the supply of water until the problem has eased. PTT will also consider the possibility of jointly investing in desalination or reserve osmosis systems.

PTT’s operations in Rayong and Chon Buri consist of four gas separation plant units, three refineries – Thai Oil Plc, Rayong Refinery Plc and Star Petroleum Plc – and four petrochemicals groups – Thai Olefins Plc, National Petrochemical Plc, Aromatics (Thailand) Plc and Bangkok Polyethylene Plc.

All listed affiliates also informed the stock exchange about possible impacts from water shortages and their measures for dealing with the problem.

Aromatics (Thailand) said it would be barely affected because the plant consumes only 30 cubic metres of water per hour. The firm would not have to reduce its production capacity as it has contingency measures such as recycling water and using tap water supplied by PTT.

Aromatics said it’s also prepared for flexible management of supply and product off-take if its clients need to lower production.

“All of our products can be exported if the domestic off-takers reduce their demand, which would cause less impact to our operation,” the company said.

National Petrochemical’s plant will also run at normal capacity, the company said.

The company has established mid-term and long-term solutions so that the company can maintain its production at a normal rate.

Thai Oil said it operations would only be affected slightly because its own seawater desalination units could produce 340-400 cubic metres per hour. That amounts to 65 per cent of all water used in the group’s normal production process, except for the electricity plant of Independent Power (Thailand) Co Ltd.

“Thai Oil thus has enough water to substitute the reduced supply,” it said.

While the units will work at full capacity, Thai Oil also plans to bring in water from the Chao Phya River through crude carriers of Thai Oil Marine Co Ltd, to supply electricity plants and reserve water for the entire group.

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