National oil and gas conglomerate PTT Plc remains upbeat regarding the positive business outlook predicted for later this year, although the prices of petrochemicals, one of PTT's key products, are expected to keep falling.
In the first quarter of 2024, the price of high density polyethylene (HDPE) decreased by 4% from the corresponding period last year to US$1,041 per tonne, while the price of paraxylene (PX) dipped by 1% year-on-year to $1,027 per tonne.
The company expects HDPE prices to range from $1,011-1,111 per tonne and PX to stand between $996 and $1,096 per tonne this year.
"Despite the prices of petrochemical products remaining low, notably determined by global market demand, we believe PTT's overall business performance will be better in 2024," said Tanapon Prapapan, PTT's vice-president for investor relations.
In the petroleum business, Mr Tanapon believes sales will grow this year as a result of more gas production, an increase in the country's GDP and higher crude oil prices.
PTT's petroleum drilling arm, PTT Exploration and Production Plc (PTTEP), has increased its gas production capacity from the Erawan gas block in the Gulf of Thailand to 800 million standard cubic feet per day (MMSCFD), up from 400 MMSCFD.
Although gas prices are expected to decrease slightly as a result of higher domestic gas supply in the country, PTTEP expects a positive business outlook as it is able to control production costs at levels enabling it to compete in the market.
According to Mr Tanapon, Thai GDP is projected to grow by 2.7% in 2024, which is higher than last year, while Dubai crude oil reference prices are estimated to range between $79 and $89 per barrel, a 2% increase from 2023, he said.
From January to March, the Dubai crude oil reference price stood at $81.3 per barrel on average, a 1% increase from the corresponding period last year.
PTT will also earn money from a battery manufacturing business through its subsidiary Nuovo Plus, which formed a joint venture called NV Gotion with Gotion Singapore Pte.
NV Gotion has supplied battery modules and battery packs for electric vehicles and energy storage systems since December last year.
PTT's total revenue from its oil and non-oil businesses increased by 3% year-on-year to 782 billion baht in the first quarter, with net profit rising by 4% year-on-year to 28.9 billion baht.