Tarco to extend fuelling points

Financial and administration manager Rawinda Punnahitanon said last week that Tarco was preparing its pre¬liminary design for the extension and that the study should be completed by November.

"Once the study is completed, we will know how much we need to invest. Initially, we estimated the investment to be over Bt100 million. This would be a major investment for Bafs [Bangkok Aviation Fuel Services] over the next five years," she explained.

Tarco is a subsidiary of Bafs, the largest aviationfuel services provider with a total shareholding of 90 per cent. Recently Airports of Thailand announced plans to proceed with Suvarabhumi's secondphase development, which with an investment of Bt77 billion will include the construction of a new terminal and additional runways.

Tarco spent Bt1.7 billion laying down fuel pipelines covering Concourses A to E during the first phase.

Rawinda said Tarco would come up with a detailed design next year, and that construction was scheduled to start in 2010. The company will borrow to finance the project.

"We have the ability to borrow without support from the par cent company. At present our debttoequity ratio [D/E] is roughly 1:1. There's room to borrow more," she said.

MR Supadis Diskul, managing director of Bafs, said that apart from investing in Tarco, another Bafs subsidiary, JPOne Asset, had concluded a deal to construct a 15millionlitre storage tank for an oil company. Under the contract, after 10 years JPOne Assets is entitled to rent the tank back from the oil firm for the subsequent 10 years.

JPOne Asset has to invest Bt190 million to build this oil tank.

"Bafs will not make any major investments over the next five years. Our subsidiaries will be doing the investing, and this is good for us," he said.

Bafs' board of directors last month approved the purchase of 2.55 million shares in JPOne Asset from Siam Investment Fund and Finansa Fund Management. As a result, the company's holding in JPOne Asset increased from 50 per cent to 92.5 per cent.