Riding the oil cycle
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Riding the oil cycle

After a lifetime in the petroleum business, PTT head Tevin Vongvanich has taken on the teachings of Buddha to grapple with an ever-changing world and plot a path for a brighter, more secure energy future

PTT will decide whether to diversify into new businesses or launch projects that will generate more profit for the company, Mr Tevin says.
PTT will decide whether to diversify into new businesses or launch projects that will generate more profit for the company, Mr Tevin says.

Around 40 years ago, a boy made the fateful decision to start working at a petrol station, all so he could spend his free time earning a bit of pocket money rather than idling his weekends away.

Fast forward to today, and that boy has grown up to become the president and chief executive of the Thai oil and gas conglomerate PTT Plc.

Tevin Vongvanich, 58, has presided over the country's biggest oil company during a period when global crude prices fell into the doldrums. At such a volatile time, the firm now more than ever seeks to ensure the energy security of the country.

"When I was around 14 years old, I worked at a petrol station," Mr Tevin says. "At the time, my father was working as a marketing director at Esso Thailand. I didn't just learn how the oil retail business is run, but I was also able to see how guys working at petrol stations earn a living."

Some 40 years ago, Mr Tevin was a part-time worker at a petrol station. Now he's at the helm of a company that, among other things, operates 1,400 such stations nationwide.

He describes his childhood as a joyful period when he spent most of his time with his younger brothers, saying he was deeply informed by the lessons his father imparted on him.

"He taught us to learn by doing. For instance, in order to learn how to defend ourselves, he had us take up muay Thai," Mr Tevin says, adding that a lot of the things he came to understand while young helped him adapt to tough times.

Apart from being a good fighter, Mr Tevin was also a good student. Setting his sights on chemical engineering, he enrolled at Chulalongkorn University, where he ultimately graduated with first-class honours.

His academic pursuits then led him to Rice University in the US, where he continued his studies in chemical engineering.

"That was around the time when we discovered natural gas in the Gulf of Thailand," Mr Tevin recalls. "The government was about to draft a plan to develop projects to make use of the gas, which was a very exciting thing because it was the first time we'd found such a valuable resource in our country."

Due to the changes occurring in Thailand, his father suggested that he continue his studies by also earning a master's degree in petroleum engineering.

At that time, petroleum and petroleum exploration were completely new to Thailand, and thus there was no specific university faculty that could provide the requisite course of study at home.

As a result, there were very few petroleum engineers equipped to deal with the country's gas exploration plans, which indirectly provided Mr Tevin with the opportunity to play a vital role in the country's changing fortunes.

Upon completing his graduate studies in the US and returning home, he started working at Unocal Thailand as an engineer tasked with issues related to production and planning.

PTT headquarters on Vibhavadi Rangsit Road in Bangkok.

"As we know, there were very few people who had the knowledge to run such a big project in Thailand at that time," he says. "So we did our best to learn as much as we could from foreigners, particularly Westerners, before we started thinking about developing and producing the country's resources on our own."

After five years of working at Unocal, Mr Tevin left the company in order to join the country's sole petroleum exploration and production company, PTT Exploration and Production Plc (PTTEP).

"Back in the old days, PTTEP only had around 40 employees," he says. "That small handful of people, however, did a very good job in making PTTEP the successful company that it is today."

Mr Tevin encourages PTT staff to take part in activities related to corporate social responsibility such as reforestation and sporting events.

Despite how things have panned out, he admits that leaving a big foreign firm like Unocal to join a newly launched Thai company like PTTEP seemed perhaps not the smartest move at the time.

But for Mr Tevin, the challenge of taking part in such a significant step in the country's development -- building up its energy security -- proved irresistible.

He spent 15 years at PTTEP working in numerous roles, including surveying and exploring, developing exploration sites, and evaluating the risks and rewards of the country's new exploration and investment efforts at home and abroad.

"Starting as a state enterprise with registered capital of only 400,000 baht, it is now a publicly traded company with huge assets and an even greater responsibility in seeking new petroleum resources to secure the country's energy supplies," Mr Tevin says. "I am proud to be a part of it."

Having worked in such varying capacities and taken on myriad risks and challenges along the way, he had a wealth of experience to draw on by the time he was appointed as head of PTT, the parent company of PTTEP and several other subsidiaries.

Mr Tevin admits that the responsibilities involved in being at the helm of the country's national oil and gas conglomerate are so broad that it's almost difficult to convey.

Being PTT's president and chief executive, he must take care of several of the group's businesses, including oil, gas, power, petrochemicals and pipelines.

With such a massive task at hand, he has had to view the company's work through four key metrics necessary to assure PTT's success: sufficiency, thoroughness, fairness and sustainability.

For sufficiency, Mr Tevin says PTT will continue to seek more petroleum and other energy resources to continue powering the country.

Mr Tevin encourages PTT staff to take part in activities related to corporate social responsibility such as reforestation and sporting events.

For thoroughness, he says PTT will make certain that the fruits of the country's energy resources are brought to Thais nationwide.

For fairness, energy products delivered to Thai consumers should be sold at fair prices that also satisfy the company's shareholders.

For sustainability, PTT has been tasked not only with securing energy supplies for Thais today, but also for generations to come.

Mr Tevin says PTT is currently working on increasing its productivity and creating economies of scale to offset losses incurred as a result of weak global oil prices.

The group is also set to make a raft of decisions on whether to diversify into new businesses or start new projects that will generate more profits for the company.

"Another thing we need to do right now is create innovations that will help drive new business and generate revenues and profits for the company in the long term," Mr Tevin says.

Talking about his work, heightened stress is almost inevitable at a time when the company is, on the one hand, forced to generate more income, while on the other, tasked with handling an ever-shifting business climate and a collapse in global oil prices.

"It is a stressful job, but we need to get through it and we are doing our best to do just that," Mr Tevin says.

He says that with low oil prices, it's a good time to look into the company's investment strategy and think about whether it is or isn't a good time to go ahead with certain plans.

If the answer is yes, it follows that the company will go forward as it had initially set out to do. If not, he says they will postpone those plans as needed.

"If executing an investment idea proves to be beyond our powers, we will stop it or otherwise rethink it," Mr Tevin says. "But for some kinds of investments, such as those in oil and gas infrastructure and facilities, we need to go forward no matter what happens, as those plans are an investment in our future."

Mr Tevin encourages PTT staff to take part in activities related to corporate social responsibility such as reforestation and sporting events.

When asked about the principles that have helped him navigate tough times past and present in both his professional and personal life, Mr Tevin credits Buddhist teachings with providing him a solid foundation, especially with regard to the reality of suffering.

"All things that come into the world stay for a while before finally decaying and dying," he says. "No one can escape from the cycle of truth, and that includes the cycle of oil prices. So I as well as PTT will follow the same method: look at what we are doing and where we are investing, and make it appropriate to the situation. When the rising cycle comes again, we will be ready to capitalise on it and secure appropriate profits."

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