3-11-2023 (BANGKOK) – PTT Exploration and Production (PTTEP), a company listed on the Stock Exchange of Thailand, is planning to expand its petroleum production capacity in the Middle East and Malaysia in preparation for the anticipated depletion of domestic gas and oil supplies in the coming decade.
According to Sumrid Sumneing, the Executive Vice-President for Finance and Accounting at PTTEP, energy analysts have forecast a decline in the production of oil and gas within Thailand. This would necessitate an increase in the importation of liquefied natural gas (LNG).
The drop in domestic gas supply, notably at the Erawan gas field in the Gulf of Thailand, resulted in higher LNG imports and increased prices last year. This was exacerbated by the consequences of the Russia-Ukraine conflict.
Thailand is heavily reliant on gas, constituting approximately 60% of the fuel used for electricity generation. An increased reliance on imported LNG, especially from the spot market, exposes the country to price fluctuations that could lead to higher electricity bills.
Domestic gas supply reached its peak in 2014, thanks to the South Bongkot gas block, which contributed to a total gas production of 3,800 metric million standard cubic feet per day from all energy companies in Thailand, as reported by the Department of Mineral Fuels.
Given the expected decrease in domestic gas volume, PTTEP intends to direct its attention towards petroleum exploration and production ventures in Malaysia and the Middle East, Sumrid stated. This strategic shift aims to enhance national energy security and create fresh business prospects for the company.
PTTEP currently relies on domestic sources for 67% of its total petroleum sales, with 11% sourced from the Middle East, 10% from Malaysia, 9% from Myanmar, and the remainder originating from Indonesia, Vietnam, and Algeria.
One of PTTEP’s key projects is the Lang Lebah field in Malaysia’s SK410B block, situated off the coast of Sarawak. The Lang Lebah project recently completed its front-end engineering design in October and is slated to commence gas production in the first half of 2028. Additionally, the company has multiple petroleum sites in Malaysia, including SK314A, SK438, SK417, PM407, and PM415, all in various stages of exploration.
Beyond Malaysia, PTTEP is actively engaged in petroleum production activities in Oman and the United Arab Emirates.
According to Sumrid, the company anticipates that the average gas prices in the global market will range between $5.8 to $5.9 per million British thermal units, while the Dubai crude oil reference price is projected to fall within the $70 to $90 per barrel range next year.
PTTEP’s total sales volume for 2024 is anticipated to increase, averaging 510,000 barrels of oil equivalent per day (BOED), up from this year’s 463,000 BOED.
