National oil and gas conglomerate PTT Plc plans to accelerate investment through mergers and acquisitions (M&As) to acquire energy resources as oil prices slide.
Chief executive Pailin Chuchottaworn yesterday said global oil prices, which have fallen by more than 50% in recent months, made it a suitable time to ramp up its M&A strategy.
PTT is about to revise its capital expenditure, set at 327 billion baht from 2015-19, so that its investment strategy is in line with the situation.
Mr Pailin said the revision was expected to be finalised by the end of next month, with about half allocated for oil and gas business.
"We've told our strategic business department to seek energy resources to invest in," he said.
"Costs of bidding for being a project developer or contractor will be lower than last year due not only to weaker global oil prices but also to the economic slowdowns in Europe and Japan."
PTT plans to list some of its retail oil businesses on the Stock Exchange of Thailand (SET) and hopes that doing so will improve its brand value and loyalty among motorists.
Its oil retail businesses include oil logistics, oil depots, cooking gas and compressed natural gas.
A feasibility study will be completed by mid-year before the board decides whether to list the companies.
Last year, its oil retail businesses generated a net profit of 9 million baht.
Chief finance officer Wirat Uanarumit said a certain amount of its capital expenditure would come from its spin-off plan including the sale of shares in Bangchak Petroleum Plc and Star Petroleum Refining Co, which are due to generate cash flow this year.
PTT's revenue last year dropped by 0.3% to 2.83 trillion baht, while net profit fell significantly by 40% to 55.8 billion, he said.
Mr Wirat blamed stock losses from its oil refinery of nearly 29 billion baht for the substantial drop in net profit.
Other negative factors were losses of 10 billion baht from cooking gas sales and 20 billion from the compressed natural gas business.
Mr Pailin said the restructuring and the government's energy price reform would help to return business to normal this year.
PTT shares closed yesterday on the SET at 345 baht, unchanged, in heavy trade worth 1.33 billion baht.