Energy industry saw major changes in 2015in 2015

The impacts are mixed within the industry. Oil and gas explorers and producers were the hardest hit. With prices of Brent crude oil running around US$37 a barrel, many oilfields are producing at a loss. The averaged production cost of PTT Exploration and Production, for example, is about $40 a barrel.
But this was still another good year for petrochemicals, as the oil-price plunge gives room for larger spreads. Siam Cement Group, for instance, is expected to book its best profits in 102 years, thanks to its chemicals business, which contributes half of the group’s earnings. SCG Chemicals is reportedly paying out a 7.5-month bonus to its workers.
Integrated oil companies like PTT are doing better than many international oil giants around the globe. Diversified oil refiner Bangchak Petroleum reported this month that its EBITDA (earnings before interest, tax, depreciation and amortisation) ex-inventory losses looked set to break recent records.
Somewhat surprisingly, renewable energy continues to be robust, thanks to continued incentives and support from governments around the world, and continued advancement in technologies that have helped lower costs and make it more competitive with fossil fuels, and the “green” energy trends.
The Energy Regulatory Commission’s auction for solar farms developed at the premises of government agencies and agricultural cooperatives, though facing some delays, attracted about 600 applications with total generating capacity of about 2.8 gigawatts, nearly four times the planned purchase of 600 megawatts.
Power-plant companies, thanks to the long power purchase contracts they have secured with the Electricity Generating Authority of Thailand (Egat), have continued to show strong results.
They actually have become an even more darling choice for stock investors, amid the economic slowdown and high market volatility.
Oil prices fell by about half from June of last year to January. The prospects look bleak for next year, as there is no end in sight for the glut.
The International Monetary Fund expects oil prices to fall to $20-$30 next year, when Iran ramps up its crude-oil exports, estimated to the tune of a million barrels a day.
Besides the plunging oil prices, Thai energy companies have been grappling with many other problems, ranging from the economic slowdown and depleting natural resources to constraints on environmental aspects.
With the national electricity reserve margin – surplus supply versus demand – projected to stay higher than 30 per cent for a decade to come, all conventional power companies are vying to find new growth abroad.
Companies from Egat and Ratchaburi Electricity Generating Holding to Banpu have ventured all |over the region – from China to |Japan, Australia and many other countries.
The largest downstream petrochemical group, SCG, has shifted its focus to other countries in Asean, including Vietnam, where it is developing the $4.6-billion Long Son petrochemical complex. With some even predicting the end of the “Oil Age”, citing a possible breakthrough in various technologies including electric vehicles, solar power, smart grid, “Internet of Things” and distributed generation, oil companies including PTT are looking more seriously at what they call “the new S-curve”, which could either be new businesses or new markets.
Siri Jirapongphan, executive director of the Petroleum Institute of Thailand, told The Nation this month that he was among those who believed the Oil Age was ending.
“The Stone Age did not end for a lack of stone, but because people found some replacements.
“The Oil Age will end long before oil is gone,” he said.
Tevin Vongvanich, chief executive officer of PTT, also told The Nation that the state-controlled energy conglomerate, which had found its first “S-curve” in the utilisation of indigenous natural-gas resources as feedstock for the first petrochemical complex in Thailand more than three decades ago, wanted to share its experience to help neighbouring countries such as Vietnam, Myanmar, Malaysia and Cambodia develop their petrochemical complexes, which would help boost their economies substantially.