Thai Oil Public Company Limited Thai Oil Public Company Limited PTT - - PowerPoint PPT Presentation

“PTT Management, Fund Managers & Analysts Site Visit” January 15, 2005 “PTT Management, Fund Managers & Analysts Site Visit” January 15, 2005

Thai Oil Public Company Limited Thai Oil Public Company Limited

CONFIDENTIAL – NOT FOR DISTRIBUTION, NOT AN OFFER OF SECURITIES

• Company Overview
• Industry Overview
• Profit Enhancement Plan
• Progress of Investment Programs

3

Company Overview Company Overview

Business Business

! ! Leading refinery in Thailand

Leading refinery in Thailand – – 21% of Thailand 21% of Thailand’ ’s total refining capacity s total refining capacity

! ! One of the most complex refinery in Asia

One of the most complex refinery in Asia – – currently 220,000 bbl/d currently 220,000 bbl/d capacity and will increase to 270,000 bbl/d by end 2006 capacity and will increase to 270,000 bbl/d by end 2006 Location Location

! ! Near deep sea port and only 124 km from Bangkok

Near deep sea port and only 124 km from Bangkok

! ! Access to crude receiving and product delivery network

Access to crude receiving and product delivery network Share Share-

• holders

holders & & Off Off-

• takers

takers Other Businesses Other Businesses (% Ownership) (% Ownership) Other 28% TPX/ BCP 8% PTT 46% Shell/ Caltex 18% Thaioil Power (55%) Thaioil Marine (100%) Thai Paraxylene (100%) Thai Lube Base (100%) Thai Petroleum Pipeline (9%) IPT (56%)

Thaioil Thaioil (24%) (24%)

Other 10% PTT 49.5% CPB 0.02% Public 40.5%

Share Share-

• holders

holders Off Off-

• takers

takers

4

Company Overview – Map of Operations Company Overview – Map of Operations

Source: Ministry of Energy 2003

9% 10% 59%

11% 11%

! ! Close proximity to high consumption area

Close proximity to high consumption area

! ! Available multi

Available multi-

• product pipeline capacity

product pipeline capacity

! ! Next to deep sea port

Next to deep sea port

5

Company Overview – Plant Configuration / Efficiency Company Overview – Plant Configuration / Efficiency

Plant Configuration Plant Configuration Maintaining Plant Efficiency Maintaining Plant Efficiency

CRUDE CRUDE OIL OIL IMPORTED LONG RESIDUE

CDU 1-2-3 KMT HDT 1-2-3 CCR 1-2 ISOM ADIP HDS 1-2 TCU MX FCCU BBU HVU 1-2-3 HMU 1-2

FUEL GAS LPG PREMIUM REGULAR MX JET KEROSENE AGO DIESEL FUEL OIL BITUMEN SULPHUR

HCU 1-2 SRU 1-2 ADIP 1-2

! !

Scheduled turnaround every 3 to 6 years to Scheduled turnaround every 3 to 6 years to lengthen plant availability and ensure plant lengthen plant availability and ensure plant integrity integrity

! !

Plant consists of multiple units which Plant consists of multiple units which allow for separate major turnaround, allow for separate major turnaround, regular repair and maintenance work on regular repair and maintenance work on specific units without interrupting entire specific units without interrupting entire

• perations
• perations

! !

Allows for additional Allows for additional debottlenecking debottlenecking

• pportunities with minimal interruption to
• pportunities with minimal interruption to
• ther processes
• ther processes

Continuous operations and high efficiency help establish Thaioil as one of the lowest cost refiners

6

Company Overview – Infrastructure Company Overview – Infrastructure

Thaioil Refinery Thaioil Refinery Significant Infrastructure Available Significant Infrastructure Available for Future Expansion for Future Expansion

! !

Land available for Land available for

" "

CDU CDU-

• 3

3 debottlenecking debottlenecking

" "

Integration and expansion of Integration and expansion of Thai Thai Paraxylene Paraxylene plant plant

" "

Up to 1,400 MW IPP expansion Up to 1,400 MW IPP expansion

" "

Up to 80 MW for SPP Up to 80 MW for SPP expansion expansion

! !

Other available infrastructure Other available infrastructure including 28 including 28-

• inch natural gas

inch natural gas pipeline, 230 KV transmission lines pipeline, 230 KV transmission lines and 16 and 16-

• inch and 28

inch and 28-

• inch water

inch water pipelines pipelines

PTT

VILLAGE VILLAGE SHELL DEPOT BP/ Q8 TANK FARM ESSO LAND

TOC- 2 TOC- 1 FLARE

SITE OFFICE

UTILITIES

LORRY LOADING RAW WATER RESERVOIR

TOC- 5 HMU- 2

CCR- 2 CLEANING YARD

SPP

MX

ISOM. ETP

IPT TPX

TOC- 4 TOC- 3 HDS- 2 / 3

ILB

TLB

KHAO PHO BAI

J ETTY

FIRE STATION MCB Main Access Road MARSHALLING YARD OMCR

7

Company Overview - ISO Achievements

! !

ISO ISO 9002 9002 : : Accredited Accredited in in 1996 1996

! !

ISO ISO / / IEC IEC Guide Guide 25 25 : : Accredited Accredited in in 1996 1996

! !

ISO ISO 14001 14001 : : Accredited Accredited in in 1999 1999

! ! TIS

TIS 18000 : 18000 : Accredited in July Accredited in July 2001 2001

8

Company Overview - Integration among Thaioil’s Group

PTT Thaioil

Thaioil Power (SPP)

EGAT

IPT TPX TLB

N.Gas

28 mmcfd 8 mmcfd

Back up G/O SSA 200 Bt.M. Back up G/O SSA 50 Bt.M. Back up Power By Products Return SSA 80 Bt.M. LR 850,000 T/yr By Products Return Black Start 41 MW N.Gas SSA 150 Bt.M. MX 250,000 T/yr 11.5 MW, 42 T/hr 9 MW, 10 T/hr 50 MW 84 T/hr 120 mmcfd N.Gas 700 MW

• TOP SSA

: Land, Admin., Back-up fuel, Utilities, Common Infra., Desal Water and O&M.

• TPX SSA

: Land, Admin., Back-up fuel, Utilities, Jetty and Storage.

• IPT SSA

: Land, Admin., Back-up fuel, Fire Fighting and Pipeline.

• TLB SSA

: Land, Water Treatment System, Fire Fighting, Jetty and Material.

9

Company Overview - 9 Months Performance Company Overview - 9 Months Performance

GRM continues to grow GRM continues to grow Capacity Utilization Rate Capacity Utilization Rate

88% 94% 104% 2001 2002 2003 1 H 2004 9 M 2004 106% 103%

Net Profit Net Profit

359 507 6,750 2001 2002 2003 9M 2003 9M 2004 10,049 5,319 1.34 2.61 3.38 6.48 7.24 2001 2002 2003 1H 2004 9M 2004

(US$/bbl)

EBITDA EBITDA

(Bt mm)

5,647 9,242 12,028 2001 2002 2003 9M 2003 9M 2004 18,344 7,787

10

Industry Overview - Oil Prices Movement Industry Overview - Oil Prices Movement

Oil Prices Movement Oil Prices Movement

US$/bbl US$/bbl

2 0 2 5 3 0 3 5 4 0 4 5 5 0 5 5 6 0

Jan 04 F eb M ar A p r M ay Ju n Ju l A u g S ep O ct N o v D ec Jan 05

! !

Middle Distillate prices surged during Middle Distillate prices surged during Oct Oct – – Nov 04 due to stock piling in Nov 04 due to stock piling in anticipation of higher heating oil anticipation of higher heating oil demand for winter. demand for winter.

! !

High stock and milder weather than High stock and milder weather than expected in US caused the heating oil expected in US caused the heating oil prices to decline in Dec 04. prices to decline in Dec 04.

! !

Price rebounded in Jan 05 due to the Price rebounded in Jan 05 due to the OPEC production cut, colder weather OPEC production cut, colder weather in US and violence in Iraq. in US and violence in Iraq.

! !

Average stock gain for 2004 is Average stock gain for 2004 is appx appx. . 0.75 0.75 – – 1.00 US$/bbl. 1.00 US$/bbl.

(US$/bbl) (US$/bbl) Dec 03 Dec 03 Dec 04 Dec 04 +/ +/-

• Gasoline

Gasoline 42.88 42.88 44.43 44.43 +1.55 +1.55

• Diesel

Diesel 37.10 37.10 47.55 47.55 +10.45 +10.45

• Dubai

Dubai 28.42 28.42 34.17 34.17 +5.75 +5.75

• Tapis

Tapis 32.45 32.45 39.84 39.84 +7.39 +7.39 Year End Oil Prices Year End Oil Prices

Diesel Diesel Gasoline Gasoline Tapis Tapis Dubai Dubai Fuel Oil Fuel Oil

11

Industry Overview - Singapore GRM in 2004 Industry Overview - Singapore GRM in 2004

! !

Strong demand in US and Asia (mainly in Strong demand in US and Asia (mainly in China) and no new grass root refineries. China) and no new grass root refineries.

! !

Refineries in Asia Pacific operated at full Refineries in Asia Pacific operated at full capacity in 2004. capacity in 2004.

! !

Growth in Middle Distillate demand in Asia Growth in Middle Distillate demand in Asia Pacific is higher than other products. Pacific is higher than other products.

! !

High utilization rate caused higher fuel oil High utilization rate caused higher fuel oil surplus hence lowering the fuel oil price. surplus hence lowering the fuel oil price.

! !

Far East Far East – – sweet crude price was higher than sweet crude price was higher than Middle East (M/E) Middle East (M/E)– – sour crude by an average sour crude by an average

• f 6
• f 6-
• 7 US$/bbl due to the high Middle Distillate

7 US$/bbl due to the high Middle Distillate demand. demand.

! !

High complex margin was supported by lower High complex margin was supported by lower price M/E crude and high Middle Distillate price M/E crude and high Middle Distillate price. price.

Singapore Gross Refinery Margins Singapore Gross Refinery Margins

US$/bbl US$/bbl

• 2

2 6 10 14

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Complex Hydroskimming Source: FACTS, Fall 2004 (Jan Source: FACTS, Fall 2004 (Jan-

• Sep 04) and Thaioil

Sep 04) and Thaioil (Oct (Oct – – Dec 04) Dec 04)

Asia Pacific Oil Demand / Supply Asia Pacific Oil Demand / Supply -

• 2004

2004

19929 20069 20304 20925 22315 90% 87% 86% 84% 83% 2000 2001 2002 2003 2004 Demand (kbd) Utilization Rate

12

Thaioil’s View on Refining Margin for 2005 Thaioil’s View on Refining Margin for 2005

! ! Dubai is expected to range between 33

Dubai is expected to range between 33-

• 38 $/bbl.

38 $/bbl.

! ! Additional Refinery capacity will not be able to

Additional Refinery capacity will not be able to cope with demand growth. cope with demand growth.

! ! Demand growth in Asia Pacific is expected to

Demand growth in Asia Pacific is expected to increase by 3% in 2005, taking into account the increase by 3% in 2005, taking into account the projected lower economies growth in China than projected lower economies growth in China than in 2004. in 2004.

! ! New capacity from Middle East is not forecast to

New capacity from Middle East is not forecast to materialize until 2010. materialize until 2010.

! ! Average crude freight rate (VLCC) is expected to

Average crude freight rate (VLCC) is expected to average 1.50 average 1.50-

• 2.50 $/bbl due to strong oil demand.

2.50 $/bbl due to strong oil demand.

in in kbd

kbd 2005 2005 2006 2006 2007 2007 2008 2008-

• 10

10 China China 154 154

• 626

626 686 686 India India 208 208

• 55

55 240 240 Indonesia Indonesia 100 100

• 150

150 Thailand Thailand

• 50

50

• Vietnam

Vietnam

• 121

121

• Inc. Supply
• Inc. Supply

462 462 50 50 681 681 1,197 1,197

• Inc. Demand
• Inc. Demand

805 805 695 695 720 720 2,259 2,259 New APR Refinery Capacity New APR Refinery Capacity

Source: FACTS, Fall 2004 and The Company Source: FACTS, Fall 2004 and The Company

In In kbd kbd 2004 2004 2005F 2005F Asia Pacific Asia Pacific 22,315 22,315 23,120 23,120 China China 6,030 6,030 6,480 6,480 India India 2,210 2,210 2,280 2,280 South Korea South Korea 2,230 2,230 2,270 2,270 Thailand Thailand 720 720 760 760 Regional Oil Demand Regional Oil Demand

13

TPX/TLB Operation Update TPX/TLB Operation Update

PX and MX Spot Prices Movement PX and MX Spot Prices Movement

! ! TPX

TPX

" "

PX PX-

• MX margin widened from avg.

MX margin widened from avg. 160 US$/ton in Q1 160 US$/ton in Q1-

• 3 to avg. 350

3 to avg. 350 US$/ton in Q4. US$/ton in Q4.

" "

TPX is now running at full TPX is now running at full capacity due to rising PX capacity due to rising PX-

• MX

MX margin. margin.

4 0 0 5 0 0 6 0 0 7 0 0 8 0 0 9 0 0 1 0 0 0

J a n F e b M a r A p r M a y J u n J u l A u g S e p O c t N o v D e c

PX PX

MX MX

US$/Ton US$/Ton

Lube Base Oil and HSFO Prices Movement Lube Base Oil and HSFO Prices Movement

! ! TLB

TLB

" "

Lube base prices improved in Lube base prices improved in 2004 due to growing demand and 2004 due to growing demand and permanent shutdown of lube base permanent shutdown of lube base plants in Asia. plants in Asia.

" "

TLB is now running at 80%. TLB is now running at 80%.

1 0 0 2 0 0 3 0 0 4 0 0 5 0 0

J a n F e b M a r A p r M a y J u n J u l A u g S e p O c t N

• v

D e c

US$/Ton US$/Ton

500 SN 500 SN

HSFO HSFO

14

Profit Enhancement Plans for 2005 - 2006 Profit Enhancement Plans for 2005 Profit Enhancement Plans for 2005 -

• 2006

2006

Refinery Refinery

" " Maintain high intake despite the planned shutdown for maintenanc

Maintain high intake despite the planned shutdown for maintenance. e.

" " Continue HMR study to improve operational efficiency and effecti

Continue HMR study to improve operational efficiency and effectiveness of Thaioil & veness of Thaioil & its subsidiaries and seek synergy benefits. its subsidiaries and seek synergy benefits.

" " Effectively manage cash flow of the group to lower financing cos

Effectively manage cash flow of the group to lower financing cost while optimizing the t while optimizing the benefit of all stakeholders. benefit of all stakeholders.

IPT IPT

" " Plan to acquire 24% shares in IPT from Unocal, combined holding

Plan to acquire 24% shares in IPT from Unocal, combined holding increase to 50%. increase to 50%.

" " IPT will run 700 MW starting Feb 05.

IPT will run 700 MW starting Feb 05.

" " Insurance compensation is expected to be finalized in Q1/05.

Insurance compensation is expected to be finalized in Q1/05.

15

Profit Enhancement Plans for 2005 - 2006 Profit Enhancement Plans for 2005 Profit Enhancement Plans for 2005 -

• 2006

2006

TLB TLB

" " Extended feedstock contract to ensure continued profitable opera

Extended feedstock contract to ensure continued profitable operation. tion.

" " Under studying HMR together with Thaioil, some of the programs c

Under studying HMR together with Thaioil, some of the programs can be an be implemented within 2005 (to be reported later). implemented within 2005 (to be reported later).

TPX TPX

" " Change TPX catalyst to increase PX yield from 82% to 89%.

Change TPX catalyst to increase PX yield from 82% to 89%.

" " New catalyst will arrive at site mid Jan 05 and require 10 days

New catalyst will arrive at site mid Jan 05 and require 10 days to change. to change.

" " PX production increase from 289,000 to 348,000 KTA, starting Feb

PX production increase from 289,000 to 348,000 KTA, starting Feb 05. 05.

16

Progress of Investment Programs Progress of Investment Programs

! ! CDU

CDU-

• 3

3 Debottlenecking Debottlenecking

" " Project specification is being prepared for EPC bidding in first

Project specification is being prepared for EPC bidding in first quarter 2005. quarter 2005.

" " To include power & steam generation as supporting facility.

To include power & steam generation as supporting facility.

" " Construction work is planned to start mid

Construction work is planned to start mid ‘ ‘05 and complete by end 05 and complete by end ‘ ‘06. 06.

! ! Single Buoy Mooring (SBM) Facility Expansion

Single Buoy Mooring (SBM) Facility Expansion

" " Detailed project specification is being developed for EPC biddin

Detailed project specification is being developed for EPC bidding. g.

" " Target completion by end

Target completion by end ‘ ‘06. 06.

17

Progress of TPX Expansion Progress of TPX Expansion

TATORAY

Refinery

TPX Plant

Thaioil TPX

MX C9+ PX 289 kta

! ! Modify existing idle PU2 unit at Thaioil to

Modify existing idle PU2 unit at Thaioil to become TATORAY for conversion of Heavy become TATORAY for conversion of Heavy Aromatics (C9+) to produce additional MX. Aromatics (C9+) to produce additional MX.

! ! Change of catalyst in TPX ISOMAR unit to

Change of catalyst in TPX ISOMAR unit to allow higher PX production. allow higher PX production.

! ! Engaged UOP to carry out process

Engaged UOP to carry out process engineering design in October 2004. engineering design in October 2004.

! ! Construction is expected to start in Q3/05

Construction is expected to start in Q3/05 and complete by end and complete by end ‘ ‘06. 06.

110 kta

Refinery

TPX Plant

MX PX 407 kta 115 kta C9+ C9+

Existing Existing New New

18

DAO

Thaioil

MB/OM Crude

HCU

MB/OM LR

C D U Progress of TLB Integration Progress of TLB Integration TLB

V D U P D A B E C H T E L

GR III Base Oil Others

Tank

PPA TCU or FO Blending

HC BOTTOM

GR I Base Oil

TLB Profit Enhancement: TLB Profit Enhancement:

" "

HMR study is in progress. HMR study is in progress.

" "

Installation of facilities to Installation of facilities to utilize utilize TLB TLB’ ’s s VDU/PDA spare VDU/PDA spare capacities for production of capacities for production of additional HCU feedstock and additional HCU feedstock and also produce group III base also produce group III base

• il from HC Bottom.
• il from HC Bottom.

" "

Expect to implement by Q3 Expect to implement by Q3 2005. 2005. HVGO

19

Vision and Strategy Vision and Strategy

Goal: To be a leading integrated refinery, petrochemical and p Goal: To be a leading integrated refinery, petrochemical and power company.

• wer company.

Remain primarily a Remain primarily a “ “pure play pure play” ” refiner refiner Increase participation Increase participation in power generation in power generation /marine transportation /marine transportation businesses businesses Expand refining Expand refining capacity to capture capacity to capture future domestic growth future domestic growth Integrate and expand Integrate and expand petrochemical petrochemical business business Continue to enhance Continue to enhance refining margins and refining margins and rationalize costs rationalize costs

Thank You Thank You