PTT to expand retail, power sectors amid slower growth

PTT to expand retail, power sectors amid slower growth

PTT CEO Chansin Treenuchagron speaks during the 20th Asia Oil & Gas Conference in Kuala Lumpur, Malaysia on Monday. (Reuters photo)
PTT CEO Chansin Treenuchagron speaks during the 20th Asia Oil & Gas Conference in Kuala Lumpur, Malaysia on Monday. (Reuters photo)

KUALA LUMPUR: Thailand's state energy firm PTT Plc has stepped up investments in the retail and industrial power sectors to buffer the impact of a global economic slowdown on its oil refining and chemical businesses, its chief executive said on Monday.

"We have a global challenge and that is the (US-China) trade war. That is one of our challenges - how can we survive in the short term?" PTT's President and Chief Executive Officer Chansin Treenuchagron told Reuters.

Asia's oil and petrochemical producers are facing thin profit margins as fuel and chemical supply exceeds demand amid new production plants starting up while global demand growth slowed amid the trade war between the United States and China, the world's two largest oil consumers.

The International Energy Agency revised down its 2019 oil demand growth estimate by 100,000 barrels to 1.2 million barrels per day due to the worsening prospects for world trade although stimulus packages and developing countries should boost growth going into 2020.

"We look at continued improvement in the short term. How can we sell at lower costs? How can we find another income that doesn't depend on oil and petrochemicals?," Mr Chansin said.

One way to create more income would be expanding its retail business, he added, including expanding its Cafe Amazon brand of coffee shops across Asia.

PTT is planning an initial public offering (IPO) for PTT Oil & Retail Co (PTTOR) on the Stock Exchange of Thailand, the sixth company to be listed under the PTT group.

PTTOR, which includes gas stations, Cafe Amazon cafes and convenience stores, was expected to kick off its IPO process later this year which could raise about $2 billion.

PTT is seeking approvals from shareholders, its board of directors and the local securities authority for the IPO, Mr Chansin said, but declined to say how much the company plans to raise.

The retail unit's "market is not only in Thailand anymore, and we want to expand in Indochina and in other Asian countries," he said on the sidelines of the Asia Oil and Gas Conference.

PTTOR also plans to build an oil and liquefied petroleum gas (LPG) import terminal near Thilawat in Myanmar with the Kanbawza Group, Mr Chansin said.

PTT is also expanding its utility subsidiary Global Power Synergy which focuses on providing power to industries, Mr Chansin said.

GSPC is also pursuing a gas-to-power project in Myanmar, he said. The company has boosted its power-generating assets through acquisitions of a power project from PTT subsidiary Thai Oil Plc and the purchase of Glow Energy Plc from France's Engie SA.

Last week, PTT also increased its investment spending plan for 2019 by 47% to 103.70 billion baht to support its subsidiaries' expansion into electricity and renewable energy.

Do you like the content of this article?

Army chief hits out at 'fake news' report on social media

Army chief Apirat Kongsompong has dismissed as "fake news" a social media post alleging he threatened to "come out" to end the chaos if a no-confidence debate was launched against Prime Minister Prayut Chan-o-cha.


Procurers arrested in two provinces

Police arrested three people, including a 16-year-old, for procuring under-age girls for prostitution during raids in Nakhon Ratchasima and Kanchanaburi provinces on Tuesday night.


Jailed red-shirt singer released under royal pardon

Singer Thanat Thanawatcharanond, 60, aka Tom Dundee, has been released from jail after serving five years, half his original term for lese majeste, after a royal pardon reduced his sentence.