Team Thailand' taps regional energy boom

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http://asia.nikkei.com/Business/AC/Team ... nergy-boom

BANGKOK -- Two major Thai companies are joining forces to capitalize on booming energy demand across Southeast Asia.

Oil and gas group PTT has partnered with Ratchaburi Electricity Generating Holding, the country's largest independent power producer, to pursue projects in neighboring countries. Memorandums of understanding were signed Wednesday concerning three fields -- natural gas, coal and power generation. Plans for liquefied natural gas terminals and coal-fired power plants are already under consideration.

"We have formed Team Thailand to strengthen the competitiveness of the country in entering the global stage," Nuttachat Charuchinda, chief operating officer of PTT's Downstream Petroleum Business Group, told reporters on Wednesday.

"Although our companies are both big in Thailand, we cannot compete with larger competitors in the region alone," said Ratchaburi CEO Pongdith Potchana.

The Association of Southeast Asian Nations has numerous fast-growing economies. The upcoming establishment of the ASEAN Economic Community is expected to stoke business activity and further boost energy consumption. PTT and Ratchaburi are positioning themselves to take advantage of this.

"Our country has the technology to generate electricity but lacks the energy resources, while our neighbors have the resources but lack technology," Thai Energy Minister Narongchai Akrasanee said. He noted that only 30-40% of households in neighboring countries have electricity, compared to nearly 100% in Thailand.

First up: Myanmar

PTT and Ratchaburi's first collaboration is expected to be a floating LNG terminal in southeastern Myanmar, near the planned Dawei industrial zone. Nuttachat said the $4 million project, which will be a joint venture with local entities, should get the green light from Myanmar's government by the end of the year. It will take two years to complete.

With a capacity of 3 million tons, the terminal will initially send gas to Ratchaburi's power plants on the western side of Thailand. But after the second phase is complete, it will supply local power plants, too, Nuttachat said.

Currently, PTT has three pipelines that send gas from Myanmar. Nuttachat said Thailand's gas resources will dry up in several years' time, and that Myanmar will eventually go down the same road.

The duo is also set to work on coal projects in Myanmar. In the north of the country, they plan to build a mine with a capacity of 100 million to 120 million tons, along with a 600-megawatt coal-fired power plant.

Power generation projects in Vietnam and Indonesia are also on the table. Such endeavors would involve Ratchaburi and PTT's power subsidiary, Global Power Synergy, which currently runs about five plants in Thailand.
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