SET-listed and mostly state-owned Bangchak Petroleum Plc (BCP) is set to spend 10 billion baht to improve its oil refineries and facilities over the next four years.
President Chaiwat Kovavisarach said most refinery units and facilities are rapidly ageing and need substantial retooling.
The revamp constitutes the second round of an improvement programme launched in 2008.
"Higher efficiency and more cash flow will be seen as a result of this revamp," said Mr Chaiwat.
The improvement programme includes the thermal power plant near its oil refinery in Phra Khanong, with power generating capacity of 70 megawatts. That plant has been replaced by a combined-cycle power plant, with operations set to start by mid-2017.
The move will help save energy as combined-cycle plants are more efficient.
Another revamp programme is debottlenecking its oil refinery unit in order to help cut the percentage of bunker oil produced during the refinery process to 8% from 12% at present.
Bangchak expects the debottlenecking, which is still in the basic design process, to boost its oil refinery capacity to 140,000 barrels per day (BD) from 112,000 BD at present.
The last stage of the programme is the replacement of the equipment used in continuous catalytic regeneration (CCR), which helps create more highly refined oil products.
At present, a turnaround for CCR is required every 18 months. With the new equipment, however, such planned shutdowns will only need to occur every 36 months.
Meanwhile, Mr Chaiwat said Bangchak is looking for another core business in a related energy sector, which would be its fourth engine of business expansion.
Its existing core businesses of oil refining, fuel retailing and renewable power plants cannot be expanded further, he said.
"We've found that exploration and production are unlikely to recover in the coming years because the oil surplus remains high," added Mr Chaiwat.
Bangchak acquired a 7% share in US-based Western Lithium Co last year in anticipation of rising popularity in electric vehicles.
"We are closely monitoring this business sector as we believe it will emerge on the global vehicle market," he said.
BCP yesterday reported sales in the first half of this year rose 23% to 37.26 billion baht thanks to global oil prices recovering from an average of US$30 a barrel in January to $40-42 at the end of June.
Its wholly-owned subsidiary BCPG Plc filed for an initial public offering last month and plans to offer 590 million IPO shares to finance expansion both at home and abroad.
BCP shares closed yesterday on the Stock Exchange of Thailand at 35 baht, down 75 satang, in trade worth 214 million baht.