PTT Exploration and Production Plc (PTTEP) is gearing up for the upcoming bidding for the Bongkot and the Erawan fields after the National Energy Policy Committee (NEPC) recently announced the terms of reference (TOR) for the process.
With 20 years’ experience in operating the Bongkot project, the company said it is confident that it will be able to continue in this role with competitive operating costs and thus deliver greater benefits to the country.
The company stands firm in its commitment to creating energy security for Thailand, chief executive officer Somporn Vongvuthipornchai said yesterday.
The company also will continue to seek investment opportunities in Southeast Asia and the Middle East as well as push forward the final investment decision (FID) of key pre-development projects, particularly the Mozambique Rovuma Offshore Area 1.
The project has recently secured a long-term LNG sale and purchase agreement with EDF, an integrated electricity company based in France, to supply 1.2 million tonnes of LNG per year, Somporn added.
PTTEP yesterday reported on its performance for the first quarter of 2018, with net profit of US$423 million (Bt13.381 billion), increasing by US$74 million, or 21 per cent, from US$349 million in the same period of last year.
The profit improvement was primarily due to a sustained recovery in global oil prices and effective cost management, resulting in robust operating cash flow of US$1.04 billion, cash on hand of US$5.095 billion and an earnings before interest, taxes, depreciation and amortisation (EBITDA) margin of 74 per cent.
“The company is endeavouring to strengthen its long-term growth by participating in the bidding of the expiring concessions in the Gulf of Thailand in order to maintain the continuity in supply of natural gas for the country’s energy security, and expanding the investments through merger and acquisition (M&A) and investing in new petroleum exploration blocks in productive areas,” Somporn said.
Somporn added that in the first quarter of 2018, the company generated consolidated revenues of US$1.24 billion, an increment of US$148 million from US$1.092 billion in the same quarter of the previous year.
The key factor driving the revenue increase was improved global oil prices, resulting in higher average selling prices of US$44.01 per barrel of oil equivalent (BOE) in the reporting period, compared with US$38 per BOE in the first quarter of 2017.
Rise in unit cost
However, the unit cost in the first quarter of 2018 slightly increased to US$29.20 per BOE from US$27.54 per BOE in the first quarter of last year.
The sales volume drop in the Sinphuhorm project in Thailand and the Montara field in Australia resulted in a decrease in average sales volume of 293,099 barrels of oil equivalent per day (BOED) in the first quarter of this year, lower than the 304,108 BOED recorded in the same period of 2017, the company said.
With these factors, PTTEP reported recurring net profit of US$304 million, while non-recurring net profit was at US$119 million, mainly from profits and tax benefits related to the baht’s appreciation against the US dollar.
“We have started this year with impressive operating results,” Somporn said. “In addition, we were able to expand our investments through the acquisition of more stakes in the Bongkot project, which will add immediately to our sales volume and revenues after the transaction is complete as well as the successful bidding for exploration blocks in high potential areas.”