PTT Plc, the national oil and gas conglomerate, says it is in the process of separating its gas balance sheet from PTT to spin off the business.
President and chief executive Tevin Vongvanich said this is part of a plan to compete in the gas industry after the government fully deregulates it by allowing the retail price to move freely after being pegged for more than three decades.
He said gas demand is growing substantially and the company is also importing more liquefied natural gas (LNG) to supply rising demand.
On July 31, the National Energy Policy Council obliged PTT to separate its gas business from the parent firm to prepare for gas deregulation.
The Energy Regulatory Commission (ERC) has prepared since early this year to open up for newcomers to enter the gas business. Major energy companies such as the Electricity Generating Authority of Thailand (Egat) and Gulf Power Group have already registered themselves with the ERC to start their gas business.
Mr Tevin said it may take several more years for the country to completely deregulate the gas business.
However, he said PTT is now ready for the competition of gas business because it has strong expertise, the right human resources and cost-efficient operations.
Wirat Uanarumit, PTT's chief operating officer for the upstream petroleum and gas business group, said new players in the gas business will have no impact on competitive advantage, since the company has the strong advantage of having a full-stream energy business, ranging from upstream to midstream and downstream.
For upstream business, PTT has LNG supply from subsidiary PTT Exploration and Production (PTTEP), which has LNG supply from projects in Mozambique and Australia.
For midstream business, the company has set up a feasibility study to start its gas liquefaction plant in Malaysia. It has already acquired a 10% stake in Malaysia's national oil firm, Petroliam Nasional Berhad (Petronas).
Total gas demand in Thailand stands at 5 billion standard cubic feet per day. Some 58% is for power generation, while the rest is for other industries and the transport sector.
Domestic gas resources supply about 75% of total gas demand, while 20% is imported from neighbouring Myanmar via pipelines and the remaining 5% is imported from other regions.
But gas supply from domestic resources and Myanmar is expected to drop to roughly 40% by 2020 as gas resources are depleted.
Mr Tevin said PTT is revising its capital expenditure (capex) for the new business investment strategy over the next five years under sustainable development goals. These include a plan to add value to existing assets, boost cost efficiency and diversify business.
The revised capex is based on an estimation of the budget and will be finalised by this December.
The plan aims to add new businesses such as bio-based petrochemicals and fuel, energy storage and electric vehicles to the existing core businesses.
PTT is also joining with US-based partners to seek business relationships with startups in the US market, mostly involving energy-related fields.
PTT yesterday posted a second-quarter net profit of 31.3 billion baht, compared with 24.9 billion baht a year earlier.
Net profit for the first half of 2017 was 77.5 billion baht, up 60% year-on-year, due to rising prices for oil and petrochemical products.
PTT shares closed yesterday on the Stock Exchange of Thailand at 385 baht, up one baht, in trade worth 855.6 million baht.