Thai PTTEP Profits Up, Mozambique LNG 'To Start Up 2023'
Thai state-owned PTT's upstream business, PTTEP, on January 26 reported a net profit at $594mn for the year 2017, up by more than 60% driven by improved energy prices.
The increase in net profit was despite an impairment charge of $558mn arising from its adjustment to its Mariana Oil Sands project development plan. PTTEP in 2017 generated total revenues of $4.52bn, up from $4.33bn in 2016. The increment was mainly due to recovered average crude oil selling price of $39.20/barrel of oil equivalent from $35.91/boe, while unit cost declined from $30.46/boe to $29.05/boe. Average sales volume last year, however, was impacted from lower demand for natural gas from projects in the Gulf of Thailand.
The company has allocated total expenditure of $3.1bn for 2018, of which $1.77bn is capital expenditure (capex) and the remaining is operating expenditure. This year’s capex will be mostly spent to maintain the production level at 302,000 boe/d, primarily focusing on increasing crude oil and condensate production volumes, PTTEP said.
PTTEP plans to add more production in the future by speeding up the FID of three pre-development projects including, it said, the Mozambique Rovuma Offshore Area 1 project (operated by Anadarko), the Algeria Hassi Bir Rekaiz project, and the Vietnam Block B & 48/95 and Block 52/97 project.
"Significant progress" with Mozambique Area 1 approvals process
The Thai company said: "The Mozambique Rovuma Offshore Area 1 Project has made a significant progress by achieving several key milestones including the receipt of government approval on Legal & Contractual Framework as well as the receipt of official approval the marine concessions from the government of Mozambique. The resettlement has been commenced since November 2017, while the Project’s development plan is currently in the process of final approval from the Government of Mozambique which is expected to achieve by early 2018. The project also expedites the finalization of LNG off-take agreements, and is negotiating for project finance with financial institutions in order to support the Final Investment Decision (FID), with planned first phase of production at 12mn metric tons/yr in 2023."
Partners in Area 1 -- which include Anadarko, PTTEP and five other companies -- together have found 75 trillion ft3 of recoverable natural gas.
PTTEP also said late last year it submitted the development plan of the Algeria Hassi Bir Rekaiz project to the Algerian government and anticipates the approval in 1Q2018. The Vietnam Block B & 48/95 and Block 52/97 project is targeted to produce first gas in 2021.