PTT International Trading, a subsidiary of PTT Plc, has continued its commitment to gas price stability by securing a five-year contract to buy 300,000 tonnes of liquefied natural gas (LNG) from Oman.
The long-term procurement strategy helps ease the impact of short-term LNG purchases in the spot market, which exposes Thailand to gas price fluctuations and subsequent surges in the price of electricity bills.
The delivery of LNG will commence in 2025 and continue through 2029.
Pongpun Amornvivat, PTT's senior executive vice-president for international business, did not reveal the LNG purchase price.
This agreement is aimed at supporting the growth of the LNG market in Thailand and making the country an LNG trading centre in Asean, he said.
The deal will also enhance PTT's international trade potential.
Mr Pongpun participated in a contract signing ceremony, which was jointly presided over by Hamed Al Naamany, chief executive of Oman LNG, which sells gas to PTT.
According to media reports, PTT is also in talks with Oman LNG to buy another 800,000 tonnes annually in a nine-year contract, commencing in 2026.
The deal has yet to be finalised.
PTT has played a key role in securing energy resources for Thailand, especially when gas production at the Erawan gas field in the Gulf of Thailand was suspended due to a legal conflict 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 become the successor to Chevron, but it has been unable to enter the site due to the unsettled dispute.
The suspension of production led to a drop in the proportion of domestic gas supply to less than 40%, down from 50% of the total amount, between 2020 and 2023. This caused Thailand to import more costly LNG.
LNG prices soared dramatically in 2022 following Russia's invasion of Ukraine, leading to higher electricity prices in Thailand because gas makes up 60% of the fuels used for power generation.
