PTT Oil and Retail Business PCL clarified that the hiring of the main contractor for the Clean Energy Project (CFP) was transparent.
Thai Oil Public Company Limited explained that the Clean Energy Project (CFPC) is an oil refinery expansion project that uses advanced technology (Complex Refinery) to increase oil refining capacity and create energy security for the country. It is a large-scale investment project that requires a large amount of investment, so it is necessary to hire a company with specialized expertise, which no company in Thailand can do yet. Thai Oil has begun studying the feasibility of the CFP project since 2014, starting with the design of the production process and preliminary engineering design in 2015-2016 to obtain sufficient information to issue an invitation to bid for the contractor to perform engineering, procurement and construction (EPC: Engineering, Procurement and Construction) for the CFP project and in 2016.
Thaioil has examined the qualifications of bidders through a tran
sparent procurement process that is in line with the principles of corporate governance, with standard criteria such as financial statement analysis, financial ratios, and experience, etc. It appears that 1. Petrofac International (UAE) LLC, 2. Samsung Engineering Co., Ltd., and 3. Saipem SPA were selected and entered into the EPC contract with Thaioil in 2018 on behalf of The Consortium, consisting of PSS Netherlands BV, (Offshore Contractor) and UJV – Samsung, Petrofac and Saipem
(Onshore Contractor). The parent company of The Consortium (PSS Netherlands BV, (Offshore Contractor) and UJV – Samsung, Petrofac and Saipem (Onshore Contractor)), namely 1. Petrofac Limited, 2. Samsung Engineering Co., Ltd., and 3. Saipem SPA (the ‘Parent Company’), has issued a letter of guarantee for the performance of the entire contract by The Consortium.
Reporters reported that the CFP project helps increase the competitiveness of Thaioil Refinery by expanding the refining capacity from 275,000 barrels per day to 400,000 ba
rrels per day, resulting in economies of scale, reducing production costs, increasing flexibility in receiving crude oil, the refinery increases the proportion of heavy crude oil refining by 40-50 percent, and can increase product value by changing fuel oil into aviation fuel and diesel, which are more expensive and environmentally friendly. The investment is approximately 4,825 million US dollars. The project has been in operation since 2019. During construction, there were impacts from the handover of work and hiring of workers during COVID-19. Most recently, there was a problem of the main contractors not paying wages to the contractors during the labor rally, even though Thaioil had already paid wages to the main contractors. Analysts expect that this will affect the CFP’s completion plan, which is expected to be completed in 2025.
The latest Thai Oil (TOP) shares today (October 25, 67) are at 44.00 baht at 3:29 p.m., down 2.00 baht from yesterday. Mr. Prin Nikornkittikosol, Director of Securities Analys
is, Yuanta Securities (Thailand) said that the TOP share price has adjusted down, expected from concerns about the CFP, while TOP has not yet announced a postponement of the CFP project and confirmed that it has paid compensation to UJV-Samsung, Petrofac and Saipem in full all along. In addition, it is expected that TOP’s performance in Q3/67 will have a net loss of approximately 3,500 million baht, recognizing a loss from oil stock (Stock Loss) of approximately 7,500 million baht, following the rapid decline in crude oil prices and an 8% decrease in refining margin compared to the same period last year.
Source: Thai News Agency
