PTT International Trading, a subsidiary of PTT Plc, has reaffirmed its commitment to gas price stability by securing a five-year agreement to purchase 300,000 tonnes of liquefied natural gas (LNG) from Oman.
This long-term procurement strategy aims to mitigate the effects of short-term LNG purchases from the spot market, which can subject Thailand to volatile gas prices and subsequent increases in electricity bills.
LNG deliveries are scheduled to begin in 2025 and will continue through 2029.
Pongpun Amornvivat, PTT’s Senior Executive Vice-President for International Business, did not disclose the price of the LNG purchase.
He noted that this agreement supports the growth of the LNG market in Thailand and positions the country as an LNG trading hub in ASEAN.
The deal is also expected to enhance PTT’s international trade capabilities.
Mr. Pongpun participated in a contract signing ceremony, co-chaired by Hamed Al Naamany, the CEO of Oman LNG, which sells gas to PTT.
According to media reports, PTT is also negotiating with Oman LNG to acquire an additional 800,000 tonnes annually under a nine-year contract starting in 2026, although this deal has yet to be finalized.
PTT has been instrumental in securing Thailand’s energy resources, particularly following the suspension of gas production at the Erawan gas field in the Gulf of Thailand due to a legal dispute between the Department of Mineral Fuels and Chevron, the American multinational energy corporation whose concession expired in 2022.
PTT Exploration and Production, a subsidiary of PTT, won an auction in 2018 to take over from Chevron, but has been unable to access the site due to the ongoing dispute.
The halt in production caused the share of domestic gas supply to drop below 40%, down from 50% of the total supply between 2020 and 2023, leading Thailand to import more expensive LNG.
LNG prices surged dramatically in 2022 following Russia’s invasion of Ukraine, resulting in increased electricity prices in Thailand, as gas accounts for 60% of the fuels used in power generation.
