Bangchak gets major earnings boost from Norway venture as fuel prices soar
Thailand's petroleum and oil conglomerate Bangchak Corporation (BCP) is reaping the dividends of investing in natural resources in Norway, the company’s results show.
In the first half of this year, 30 per cent of BCP's earnings before interest, tax, depreciation, and amortisation was attributed to investment in oil and gas exploration and production in the leading mid-to-late-life operator OKEA ASA on the Norwegian continental shelf.
BCP president and CEO Chaiwat Kovavisarach said OKEA is an important flagship for BCP to achieve its long-term strategy on energy security.
He added that OKEA has witnessed constant growth in the first half of this year, boosted by rising global fuel prices amid the ongoing Russia-Ukraine conflict and increasing global demand.
"In the first half of this year, OKEA recorded 10.23 billion baht revenue from the sale of crude oil and natural gas, up 148 per cent from 4.13 billion baht in the previous year," he explained.
Chaiwat, who is also OKEA chairman, said BCP is paying attention to maintaining the balance of fossil fuels and renewable energy as natural gas and oil will continue to be the world's crucial source of energy for many decades.
He said the role that renewable energy will play in people's lives will depend on the development of renewable energy storage systems.
"BCP is placing high emphasis on balancing the energy trilemma — energy security, energy affordability, and environmental sustainability," he said.
He added that BCP will draw experience and skills from its investment in Norway as a model to expand investments in the exploration and production business to strengthen organisational stability throughout the supply chain.
Meanwhile, OKEA CEO Svein J Liknes said BCP shared the same objectives as the company on maintaining the balance of fossil fuels and renewable energy.
He added that the transition from fossil fuels and renewable energy must be made step by step based on technologies and investment budgets.
"The demand for gas and nuclear energy will soon replace coal," he said, adding that trends in renewable energy will come around 2030 and 2035.
He also vowed to make full use of the company's assets along with applying new technologies for long-term sustainability in energy.
Presently, OKEA has four oil fields in Norway, namely, Draugen (44.56 per cent stake), Gjoa (12 per cent), Yme (15 per cent), and Ivar Aasen (2.77 per cent).
OKEA is continually developing new oil fields, which will increase the company’s petroleum production to about 25,000 barrels of oil equivalent per day compared to the current of about 20,000 barrels of oil equivalent per day by the end of this year.
In the first half of this year, OKEA's production consisted of 61 per cent crude oil and 39 per cent natural gas, the latter being a critical component of the energy transition.