PTT to enter liquefied natural gas retail business

Bangkok, Thailand – PTT Philippines Corp., the local unit of Thailand’s largest petroleum company, has shelved a plan to put up a power generating facility in the country but would instead venture into the business of retailing liquefied natural gas (LNG) for transportation fuel.

The Philippine unit has already completed the study on LNG plans in the country but found it not feasible to go into LNG power generation, PTT Public Co. Ltd. vice president for international marketing Wisarn Chawalitanon said in an interview.

“The study is complete already but they don’t think they can do this year in the Philippines because the price is not competitive,” he said.

The project under study involves an integrated facility with a power plant, an import terminal and other associated facilities.

The PTT official explained that a LNG-fueled power plant will find it difficult to compete with coal-fired power plants because of pricing. 

In the Philippines, coal-fired power plants are cheaper to build and sell at affordable rates compared with other technologies like LNG. 

In 2011, PTT Philippines expressed interest in putting up a 1,200-megawatt LNG facility in Limay, Bataan.

LNG is natural gas that has been converted into liquid for ease of storage or transport.

Chawalitanon said the local unit is eyeing to put up a LNG power plant, possibly in Luzon, with partners. 

PTT is still interested in going into LNG, but to supply it as transportation fuel as an alternative to gasoline and diesel, Chawalitanon said.

He said buses and vehicles in the transport sector are being eyed as customers which may benefit more from LNG use.

“It’s still in our plan because we would like to introduce clean energy to the country,” the PTT official said. “But it’s better to use for trucks, buses [transport sector], because they consume a lot. If you use for private cars, it may not be efficient. If you consume more, you get (pay) less for LNG.”

To be able to use LNG as fuel, the market may have to adapt their respective vehicles to be able to enjoy the benefits of the alternative fuel.

“You have to use different containers. You have to adapt your car to match with LNG. That’s why the initial investment is quite high but it gives you more benefit,” Chawalitanon explained.

But before starting the LNG supply business in the Philippines, the PTT parent firm plans to test the model in Cambodia first due to proximity and government’s reception of the plan.

Chawalitanon said the Cambodian government was receptive of the idea. “That’s why we took a look at Cambodia... we are doing budgeting this year and hopefully, next year we will be in operation because it is easy to build the station, not the terminal.” 

“We already have terminal in Thailand and we’ll just transport the product from Thailand to the border,” he added.