PTTEP President and Chief Executive Officer Somporn Vongvuthipornchai.
PTTEP President and Chief Executive Officer Somporn Vongvuthipornchai.

PTTEP, partners to bid for Bongkot

Corporate June 24, 2017 01:00


4,957 Viewed

PTT Exploration and Production (PTTEP) will cooperate with its partners to bid for the operating contract to the Bongkot gas field, company president and chief executive officer Somporn Vongvuthipornchai said during a visit to the field in the Gulf of Thailand yesterday.

The Mineral Fuels Department under the Energy Ministry will open bids as early as August after two pieces of legislation on the petroleum sector were announced in the Royal Gazette on Thursday.

Somporn said PTTEP would collaborate with its partners Total E&P Thailand Co and Shell Integrated Gas Thailand to join the bid to develop the gas field once the Mineral Fuels Department announced the terms of reference (TOR) and called for tenders.

Somporn said that based on PTTEP’s survey, the Bongkot block continued to have enough gas to justify continuing to invest in it for more than 10 years. However, the company would have to commit to more investment if it wins the contract to explore in this area.

“We cannot estimate how much the investment will be but it will not be more than we [have already] invested in the Bongkot block,” he said.

PTTEP has invested Bt230 billion in the block over the past 24 years.

At present, PTTEP, Total E&P Thailand Co and Shell Integrated Gas Thailand are operating and managing the Bongkot gas field under a concession that will expire in 2022.

Currently, the Bongkot block has production capacity of 900 million cubic feet a day.

Somporn said his company was also interested in bidding to develop the Erawan gas field after its concession expires in 2021.

“We are negotiating with a partner to join the bidding. If the partner is interested, we will bid jointly, but if not, we will go ahead with the bid by ourselves,” he said.

The Erawan block is currently operated by Chevron.

Somporn said PTTEP was maintaining this year’s investment plan at US$2.9 billion (Bt98 billion) although it has suspended new investment in Indonesia after its subsidiary PTTEP Australasia (Ashmore Cartier) faced a damages claim by the Indonesian government.

He explained that the investment plan covered renovation and development of existing projects under construction and was separate from any new investment plans, so the Indonesia suspension would have no effect on the budget.

This year’s $2.9-billion investment plan was part of the company’s five-year plan to invest $14.95 billion from this year through 2021.

Meanwhile, the company also has cash on hand of $4 billion for merger and acquisition deals in the second half of this year. The M&A investment will focus on businesses related to exploration and production, Somporn said.

He said PTTEP was in talks on M&A deals worth between $200 million and $1 billion both domestically and overseas, focusing on Southeast Asia. “The deals may be finalised by the end of this year but we cannot give more details at this time.” 

Last year, PTTEP recorded revenue of Bt153.04 billion and net profit of Bt12.85 billion. In the first quarter of this year, the company’s revenue was Bt38.45 billion and net profit Bt12.28 billion, it reported to the Stock Exchange of Thailand.