Thailand’s PTT Group to hike RP investments

Despite the prevailing uncertainty in the oil industry, the PTT Group of Thailand is pushing ahead with its investment plan in the Philippines, a company official said over the weekend.

Siripong Phoungpaka, PTT Philippines Corp. president, said they would be interested to bid for the government‘s 40 percent stake in Petron Corp. should the state-owned firm decide to sell it. “If government will still want to sell its part via bidding, we will join,” Phoungpaka said.

On the company’s planned investment in the petrochemical business, he said they are still discussing it. “We’re still working on that. They are doing due diligence. We may conclude talks in the next few months,” he said.

He said they are also pursuing the planned investment in the proposed gas pipeline projects. “We are still interested in Batman (Batangas-Manila) 1 and (Bataan-Manila) 2,” he said.

The group earlier signified its interest to invest as much as $400 million in the country’s petrochemical industry.”

Such an investment will be part of the short to medium-term expansion plan of the PTT group in the country.

Aside from the $400 million earmarked for the petrochem industry, he said they are also considering investing up to $700 million for several natural gas projects.

The PTT official, however, pointed out that all the expansion plans on petrochem and natural gas industry are still in the planning stage. “

PTT is one of the major sources of petrochemical feedstock of the Philippines .

Based on PTT statistics, the Philippines is one of the top five countries for PTT’s export of plastic products in Thailand.

The Philippines is also one of the biggest clients of the PTT Group in terms of petrochemical. JG Summit Holdings owns JG Summit Petrochemical Corp. which went into commercial operations in mid-1998, and is the sole producer of PE (polyethylene) in the country.

In the first year of its operations, it produced 51,761 metric tons of PE valued at P1.3 billion and sold most of it in the domestic market. JG Summit, just like PTT, also expressed interest to bid for Petron.

In the polypropylene (PP) market, JG Summit Petrochem and another Filipino firm, Petrocorp., are the sole makers which have competed with foreign suppliers for the past couple of years. Petrocorp has already grabbed 73 percent of the domestic market by offering similar products at prices at par with offers of foreign suppliers.

PTT has so far been active in the downstream oil sector being the owner of the biggest handling facility in Subic Bay which is under a long-term lease agreement with Philippine Coastal Storage and Pipeline Corp. (PSCPC); and can store up to 2.4 million barrels of finished petroleum products.

Eyeing to undertake an initial public offering (IPO) in the near future, PTT is expected to invest another P5 billion over the next five years to continuously expand its network by at least 10-20 service stations a year.