BANPU: Bad News in Good Times.?

If we have to name one coal producer in Thailand, we all would think about Banpu Public Company Limited (BANPU)…however the period of coal’s glory has already gone due to a tons of negative impact on environment, along with numerous alternative options of new resources and renewable energy which are more eco-friendly and sustainable. 

As a result, BANPU performance in recent years fluctuates…driving BANPU to seek for other business opportunities.

BANPU established Banpu Power Public Company Limited (BPP) in order to operate energy business, which later is listed on the Stock Exchange of Thailand, reflecting a better situation for BANPU. 

After that, BANPU has acquired a gas operationship position in the Barnett shale in Texas, USA in the amount of $570 million, and the transaction of the asset has completed on October 1, 2020.

The acquisition of Barnett shale provided a bright future for BANPU as it will reinforce the firm’s natural energy portfolio, lessening the reliability of the power business.

However, there is bad news in good times…natural gas price has been hovering or in a downturn for a while, therefore BANPU might not fully recognize the income for a new investment.

Past few weeks, BANPU’s share price suddenly outperformed due to speculation after the coal price reversal…but the recovery actually because of a decrease in supply.