PTT to debottleneck LPG output capacity
Play
Move follows energy policy panel's decision to allow firm to sell at actual cost
PTT plans to debottleneck LPG (liquefied petroleum gas) production capacity at its gas-separation plants, which is expected to raise capacity at the plants by between 200,000 and 300,000 tonnes per year.
The move follows the Energy Policy Administration Committee’s resolution on Wednesday to restructure LPG pricing this year, which will see PTT gas-separation plants selling LPG to the household, industrial and transportation sectors at actual cost, instead of at the fixed wholesale cost of US333 (Bt10,950) per tonne, which is markedly lower.
The panel’s decision, which takes effect on February 2, will result in a revenue increase for the energy giant’s gas-separation business.
Nuttachat Charuchinda, PTT’s chief operating officer, Upstream Petroleum and Gas Business Group, yesterday said the company was now studying plans to debottleneck this part of its operations.
Pailin Chuchottaworn, PTT’s president and chief executive officer, said that rising domestic demand for LPG had prompted PTT to import more of the gas, and to invest in order to expand its storage and receiving capacity to cater for the additional imports.
The company is spending around Bt38 billion during the first phase of this capacity expansion, given that its existing LPG storage tanks and LPG receiving terminal in Chon Buri do not have sufficient capacity to serve the imported gas.
However, investment on the second-phase expansion now has to be delayed as the Energy Policy Administration Committee’s resolution on LPG price restructuring will result in PTT’s gas-separation plants and refinery operation producing more LPG, he explained.
As part of the first-phase expansion in Chon Buri, PTT will have the capacity to serve up to 250,000 tonnes of gas imports per month, against 132,000 tonnes presently. Construction is expected to be completed this year.
As and when completed, the delayed second phase would enable the company to import an additional 250,000 tonnes per month, lifting the overall import capacity to 500,000 tonnes.
The original phase-two completion date was 2018.
A PTT source said that after the debottlenecking, the gas-separation plants’ capacity is expected to increase by 300,000 tonnes per year, from 3.6 million tonnes currently.
The capacity of the refinery, meanwhile, is expected to increase by 60,000 tonnes per year, from the present 1.86 million tonnes.
According to the Energy Ministry, LPG consumption last year was 7.43 million tonnes, down 1.1 per cent from the 2013 level.
The biggest user of the gas was the petrochemical sector at 2.6 million tonnes, down 1.7 per cent year on year, followed by the household sector at 2.2 million tonnes, down 9 per cent.
The transportation sector consumed 2 million tonnes of LPG last year, up 11.5 per cent, while the industrial sector used 0.6 million tonnes, a year-on-year drop of 4.6 per cent.
Rotsana Tositrakul, a member of the National Reform Council, yesterday said the Energy Policy Administration Committee’s resolution to adjust to the actual LPG cost by floating the price to $488 per tonne – from the until-now fixed $333 per tonne – would benefit both the private sector and the public sector.
She will raise the issue for discussion by the council at its meeting this coming Tuesday, she said.
