PTT asked to join Egat relief scheme
Authority shoulders B60bn to cap tariffs
National oil and gas conglomerate PTT Plc has been asked to help state-run Electricity Generating Authority of Thailand (Egat) relieve its 60-billion-baht financial burden incurred by measures to alleviate rising living costs.
Assistance from PTT is part of a relief plan now being discussed by energy authorities who want to see Egat better manage its budget.
Last year Egat was ordered by the Energy Regulatory Commission to cap fuel tariffs on power bills from last September to April this year, which cost Egat around 60 billion baht.
PTT was asked to join efforts to help Egat because gas accounts for 65% of power generation costs.
Wuttikorn Stithit, PTT senior executive vice-president for gas business, said the company can help Egat curb gas expenses through many measures including adjusting payment terms on its gas purchases and seeking more long-term procurement of liquefied natural gas (LNG) from various countries.
He said more long-term LNG purchase contracts are part of energy management policies, issued by deputy Prime Minister and Energy Minister Supattanapong Punmeechaow, as they have more stable prices than those sold in the spot market.
LNG prices under long-term purchase contracts stand at US$10-13 this month, compared with $21-22 in the spot market.
It is now time to start making the long-term contracts as the spring and the summer are coming, causing global demand for gas to decline, said Mr Wuttikorn.
Thailand is expected to import 10 million tonnes of LNG this year, half of which will come from long-term purchase contracts.
LNG imports make up around 30-35% of total gas supply in Thailand, with 45% of gas coming from domestic sources and around 20% of gas delivered through a gas pipeline from Myanmar's Gulf of Martaban.
The price of gas pool is 400 baht per million British thermal unit (BTU), compared with $21-22 per million BTU of imported LNG, said Mr Wuttikorn.
Each month Egat buys gas from PTT at an average volume of 700 metric million standard cubic feet per day, with the price averaging 6-7 billion baht monthly.
However, its gas bills doubled to 12-13 billion baht, following higher demand for energy since the fourth quarter of last year and the impact of the Russia-Ukraine war.
Like Egat, PTT also helped relieve people's living costs by spending 10.5 billion baht selling gas at discounted prices to taxi drivers, manufacturers, small power producers and street food vendors.
- Egat relief