Thailand’s PTT keen on teaming up with PNOC

Thailand-based PTT Philippines Corp. has expressed interest in joining Philippine National Oil Co. (PNOC) in oil and gas exploration ventures, a ranking company official said.

PTTPC president and CEO Siripong Phoungpaka said this is part of the expansion program being carried out by its mother firm, PTT Public Co. Ltd., in the Philippines.

"PTTs’ policy is to go global, because it is now too big in Thailand and has to expand. And now we go first in Southeast Asia and we do exploration in some parts of Africa, Burma, Vietnam and Cambodia," he said.

The PTT official said in the Philippines, they may zero in on oil and gas exploration projects under the Public Contracting Round (PCR) I launched by the Department of Energy (DOE).

" We have talked with DOE and PNOC we talked with them before. Exploration activities in the country is challenging. It is too expensive. We need data to study whether there is oil or gas in the exploration areas. We’re still studying," he said.

The DOE has been aggressively promoting oil and gas exploration activities in the country. In August 2003, it opened for bidding 46 new exploration blocks located near the Malampaya gas field in offshore Palawan and other oil and gas discoveries and producing fields in southwest and east Palawan, Sulu Sea and Reed Bank under the PCR-I.

The PCR-I is a new bidding scheme which grants excellent contractual and fiscal perks.

Under the fiscal terms for PCR-1, a contractor can recover exploration and development costs from 70 percent of gross proceeds and get a maximum of 40-percent net proceeds while the government share is equivalent to 60 percent. Likewise, the contractor shall be exempted from paying national taxes except income tax, which shall be paid out of the government share.

The contractor can also get a Filipino Participation Incentive Allowance (FPIA) of up to a maximum of 7.5 percent with a minimum of 15-percent Filipino participation.

PTT Public is Thailand’s largest energy company with long and extensive experience in petroleum, petrochemical and exploration with market value of more than $24 billion as of end-December 2005.