PTTEP Enters Erawan Field after a Successful Negotiation with Chevron!

PTTEP entered the Erawan area, expecting to install platforms after the Department of Mineral Fuels successfully negotiated the deal with Chevron and the gas production would continue during the changing in 2023-2024.

 

Mr. Sarawut Kaewtathip, Director General, Department of Mineral Fuels, revealed that PTTEP Energy Development Company Limited, a subsidiary of PTT Exploration and Production Public Company Limited (PTTEP), has already entered the Erawan area and  is currently in the process of surveying the possibility of oil platform installation and preparing the Environmental Impact Assessment (EIA).

 

The Department of Mineral Fuels stated the gas production has to continue even during the changing period in 2023-2024 in the matter of national energy security, affirming Chevron Thailand Exploration and Production Ltd. as a current Erawan filed’s natural gas producer, is willing to cooperate for the entrance of PTTEP.

 

KGI Securities estimated PTTEP to post 3Q20 earnings of 5.9 billion baht (-47% YoY, +36% QoQ) mainly due to 30% YoY lower Dubai crude price in 3Q20. However, the recovery QoQ would be driven by Dubai crude price rising 41% QoQ to US$43/bbl for the quarter. 

 

PTTEP’s average selling price (ASP) is also expected to improve 11% QoQ to US$38.7/BOE in 3Q20 as its liquid selling price would recover 46% QoQ to US$42.1/bbl following higher crude price although its gas selling price would continue to soften 3% QoQ to US$6.2/mmbtu. 

 

In addition, total sales volume is expected to grow 4% QoQ to 340KBOED thanks to higher demand as the COVID%19 pandemic eased. However, its unit costs would increase slightly 2% QoQ to US$31.0/BOE from higher royalties and OPEX expenses, aligned with the increase in total sales volume. For extra items, the company will book reversion in the final remaining DTA of US$10mn (extra loss) after new related laws for Thai tax expenditure are fully effective in 3Q20.