Thai oil giant goes on a green cost hike

(Bloomberg) – The Thai oil company, which accounts for about 10% of the country’s sales, has suddenly invested billions of dollars in electric vehicles and renewable energy companies, turning its traditional businesses into chemicals and plastics.

PTT Pcl has announced a $ 10 billion investment since May to build an EV business and build petrochemical assets and renewable energy projects in Asia. And the team is not finished yet.

“The company must change its strategy and vision for sustainable growth,” said PTT’s senior vice president. Climate change requires more urgent policies and measures to reduce greenhouse gas emissions, which are detrimental to fossil fuels.

A.D. In the 1970’s, the state-owned PTT, Thailand’s largest oil company, reigned as Thailand’s largest company for decades. It is currently chasing renewable energy in India and Vietnam to increase its $ 7.7 billion investment in chemical, energy and refining units in July. PTT’s first major investment in the industry, followed by a $ 2 billion offering to Thailand’s EV Partnership in May.

This is the first time that the lower riparian businesses have made major purchases overseas, and by 2021 the total has surpassed the group’s global purchasing record in one year. Previously, PTT’s main foreign exports were through PTT Exploration & Production Pcl, which has built stocks in the oil and gas fields from Canada to Mozambique and Australia.

More purchases are coming in “Future and Pure Energy”, including renewable energy, energy storage, energy trading and AVS, Arawadee.

As PTT and its units push investors to invest in traditional fossil fuels, they are joining the ranks of the world’s leading oil companies, including Royal Dutch PLC, General SA and NSA, which are investing in clean energy. The European Union and the United States have set a goal of carbon neutrality by 2050, with President Joe Biden aiming to make half of the cars sold in the United States battery-powered, plug-in or fuel cell. Powered by 2030.

“There is a change in the group’s growth needs,” said Pauline Tang, S&P Global Ratings’ co-director in Singapore. He said the expansion of the offshore petrochemical products and renewable energy will keep the company afloat in the coming decades due to fluctuations in oil prices and demand.

In the wake of the July blast, Power Unit Global Power Senior PCC has invested about $ 950 million in a renewable energy company in India and a wind power project in Taiwan. Thailand Oil Pisces to buy $ 1.18 billion stake in Indonesia PT Chandra Asri Petroleum And PTT Global Chemical Pcl, European specialty chemical manufacturer Alenex Holding said GBN will earn $ 4.75 billion.

The future of plastics

Reusable plastics One way oil refineries continue to receive funding from petrochemicals and PTT Global has agreed to partner with a reusable plastic adhesive manufacturer in Thailand in 2019. On Wednesday, PTT announced a 56% jump in second-quarter sales a year ago, thanks in part to higher petrochemical prices.

As a state-owned enterprise, the group influences the Thai government’s bio-green economy model, which includes the production, recycling and recycling of biological resources, and balancing economic and environmental needs.

“Pure energy investments are unlikely to generate any major returns, but PTT must follow this global trend,” said Naptat Chantaraserekul, a cricket security analyst in Bangkok. “Investors’ biggest concern is the poor performance of PTT in oil fields in Canada, Indonesia’s palm plantations and oil fields in Australia.

While the high level of investment in PTT in 2021 could put pressure on liquidity, PTT’s strong financial position and good access to capital markets will help finance its purchases, said Bloomberg Intelligence analysts Mary Ellen Olsen and Shen Gupta.

As the group expands revenues outside the oil industry, PTT Exploration will continue to oversee overseas purchases, senior Vice President Oracho Uyamapan told investors earlier this month. According to his statement to investors, half of the $ 28 billion capital expenditure for 2021-25 will go to the oil and gas sector.

Since February, PTT Express has announced that it has acquired BPAP PLC for $ 20.6 billion in the OMA gas block. Last December, neighboring UAE received permission to explore the shores of Abu Dhabi.

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