PTT looks at getting out of oil palm business in Indonesia
August 08, 2014 01:00 By Watcharapong Thongrung
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PTT is considering selling its oil-palm interests in Indonesia because of lack of expertise in the business, the company's president Pailin Chuchottaworn said. He made the remark after this country's National Anti-Corruption Commission investigated the pr
In 2008, the company’s subsidiary PTT Green Energy paid US$14.725 million (Bt475 million) for a 95-per-cent stake in Indonesian palm-oil company Mitra Aneka Rezeki, which was licensed to operate 14,000 hectares of palm plantations in West Kalimantan province on Borneo island. In April that year, PTT also bought a 95-per-cent stake in Az Zhara, licensed to operate 40,500 hectares of palm plantations on Borneo.
The Thai Energy Ministry has asked PTT to review its plans to invest in alternative energy sources in Indonesia, including oil palm, to ensure optimal feasibility before submitting them to the National Council for Peace and Order (NCPO) for approval, said Kurujit Nakornthap, a ministry director-general and PTT board director.
The Energy Ministry expects to approve alternative-energy projects (garbage-fuelled and solar power plants and various royal-initiated projects) worth Bt3 billion to replace similar projects that were excluded from the 2014 budget of the Energy Conservation Fund.
The National Energy Policy Office (NEPO) has allocated Bt35 billion to support alternative-energy projects from 2012-2016. The policies the Energy Ministry will propose to the NEPO for approval include a long-term national power development plan (PDP 2015), which should cover the same time frame as the energy-conservation and alternative-energy plans, as well as accommodate the policies of the International Energy Agency; segregation of PTT’s natural-gas pipelines; reduction of PTT’s shareholding in the oil refiner SPRC; and implementation of power generation from recycling as per actual cost, while generation from other alternative energy sources such as solar energy will be submitted to the NCPO for review.