PTTEP net profit surges 40% from strategic acquisitions

The reserve-to-production (R/P) ratio also rose to 7.5 years, ensuring steady growth of the company and energy security of Thailand in the long run. PTTEP targets to raise sales volume by 11 per cent in 2020.
Phongsthorn Thavisin, president and chief executive officer, said total revenue last year amounted to $6.413 billion, increasing from $5.459 billion in 2018 or a rise of 17 per cent, resulting mainly from the acquisitions of Murphy Oil Corporation's assets in Malaysia and Partex Holding BV.
Consequently, the average sales volume last year reached 350,651 barrels of oil equivalent per day (BOED) or an 15-per cent increase from 305,522 BOED in 2018.
Meanwhile, the average selling price also slightly improved from $46.66 per barrel of oil equivalent (BOE) in 2018 to $47.24 BOE in 2019.
Due to the higher sales volume in 2019, PTTEP's net profit hit $1.569 billion, a 40-per cent increase from US$1.120 billion in 2018.
PTTEP's financial position remains strong with operating cash flow of $3.540 billion while Earnings before Interest, Tax, Depreciation, and Amortization (EBITDA) margin stands at 71%.

Phongsthorn said the "expand" strategy which included both domestic and international acquisitions and winning bids, drove the average sales volume to reach an record high of 350,651 BOED last year. 
This successful strategy also improved the company's proven reserves (P1) from 677 million BOE (MMBOE) to 1,140 MMBOE, representing a 68 per cent surge from 2018 and at the same time, pushing up the R/P ratio from 5 to 7.5 years.
"In addition to higher petroleum sales volume, we have also increased petroleum reserves as targeted. We are capable of adding more reserves in the future if our exploration projects are proved successful. This is not only building growth for PTTEP but also elevating the country's energy security in the long term. This year, PTTEP targets to raise the average sales volume by 11 per cent," said Phongsthorn.
Based on the company's performance, the board of directors on Thursday (January 30) approved a total dividend payment of Bt6 per share for 2019.
PTTEP had already paid an interim dividend for the first six months of Bt2.25 per share. Dividend for the second half of 2019 will be paid at Bt3.75 per share on April 10, 2020, after obtaining approval from the 2020 Annual General Shareholders' Meeting.
Share registration date for the right to receive the dividend is scheduled for February 14, 2020.
In 2020, PTTEP will focus on smooth transitions of the newly-acquired projects, especially the G1/61 (Erawan) and G2/61 (Bongkot), to ensure timely delivery of petroleum as stated in the profit-sharing contracts.
The preparation includes drilling plans, construction of production platforms and gas pipelines, as well as other related activities.
For the Erawan field, PTTEP is now working closely with the existing concessionaire and the Department of Mineral Fuels to ensure production continuity during the transition period.
PTTEP also plans to accelerate exploration activities in high potential areas including Malaysia and Myanmar, such as the Myanmar MD-7 project and the Lang Lebah-1RDR2 exploration well in Malaysia's block Sarawak SK410B, where it made the biggest gas discovery in the company's history. Also a priority is the other nearby exploration projects in Malaysia which PTTEP plans to develop as a cluster.
Furthermore, PTTEP will focus on utilising technology to maximise the value of existing projects and proceeding with the developments of the Mozambique Area 1 and the Algeria Hassi Bir Rekaiz projects in line with the long-term growth strategy of the company.