Major pipeline project set to begin
OIL PRICES in the North have been tipped to go down by as much as 50 satang a litre and be on par with oil prices in Bangkok when Fuel Pipeline Transportation completes its extension of its oil pipeline network from Ayutthaya to Lampang in the next three
The ministry and the company yesterday jointly held a press conference to announce the go-ahead of the northern oil pipeline project, which had been delayed for more than two years. However, the fate of the northeastern pipeline plan remains uncertain, said director-general of the Energy Business Department Witoon kulchroenwirat.
The new oil pipeline project will comprise two phases with the first one extending 350 kilometres from FPT’s existing oil storage depots in Bang Pa-in, Ayutthaya, to Kamphaeng Phet. The next phase will be to extend it 220km to Lampang.
Two oil depots will be constructed in Phichit and Lampang as part of the project.
MR Supadis Diskul, chairman of Bangkok Aviation Fuel Services (BAFS), the majority shareholder of FPT, said the project would demonstrate the benefit of private investment in the country’s infrastructure as the 570km pipeline would require an investment outlay of about Bt13 million per kilometre. In comparison, PTT’s investment in the natural gas pipeline system cost over Bt20 million per km, he said.
Supadis praised the government for its “cleanliness” and non-interference in the project, allowing it get off the ground after a long delay.
FPT runs the oil pipeline from Don Muang International Airport and the Bangchak refinery in Bangkok to Bang Pa-in.
Thai Petroleum Pipeline (Thappline) runs the other route from Lam Luk Ka in Pathum Thani to Saraburi and to Map Ta Phut, Rayong.
Thappline
Witoon said Thappline had informed the authorities it was not yet ready to invest in the northeastern route.
He said the SC Group and TRC Construction were the two companies which had expressed an interest in investing in the northeastern pipeline project that would extend from Saraburi to Khon Khon.
But for the investment to go ahead, Thappline would have to approve them connecting to its system.
Supadis said FPT might also invest in the northeastern route at some stage, but it would like to focus on the northern pipeline project for the time being. The company plans to extend the northern pipeline to two Myanmar border towns, Myawaddy and Tachileik, by 2021.
Besides the aim of halving oil transport costs and achieving parity for oil prices in the Northern and the Central regions, it is hoped the Bang Pa-in-Lampang pipeline will help improve road safety as fewer trucks will be used to carry oil to the North.
It is claimed the project would cut carbon dioxide emissions by at least 30,000 tonnes per year.
Despite BASF having to wait an expected 15 years to recoup its investment for the project, Supadis said it would not negatively affect the company’s finances since the investment would be executed by FPT.
BASF plans to reduce its shareholding in FPT from 91.55 per cent to 75 per cent by divesting the stake to PTG Energy and Bangkok Airways. The proceeds will be used to partially fund its capital increa|se plan for FPT and to pay an extra dividend to its shareholders.
Meanwhile, Supadis said he recently suggested Thai Airways International reduce its shareholding in BASF to 2 per cent from 22 per cent to aid the carrier’s financial position.
