Proposed $2.5-billion refinery would be largest in country
Southern site wouldbe export-oriented
Bangkok Post, Thursday, June 17, 2004
Yuthana Praiwan
The Energy Ministry will propose a plan to build a new refinery worth about $2.5 billion in keeping with a policy to make the country a regional energy hub under the government's southern energy landbridge project.
Pornchai Rujiprapha, the ministry's deputy permanent secretary, said the new refinery would be the country's largest, with capacity of 300,000 barrels a day. The project would be wholly invested by the private sector and licensed by the Energy Ministry.
As the project involves energy security, it will need cabinet approval. But according to the plan, the refinery is expected to be operational by 2007, he said.
"A location for the refinery will be decided by the private investor. But we think the appropriate location should be in the South where we plan to develop the landbridge as part of the long-term Southern Seaboard master plan."
The land bridge project, connecting Phangnga on the west coast with the Gulf of Thailand in the east, includes a planned chemical complex in Nakhon Si Thammarat on the Gulf coast where the refinery could be situated. The location is intended to be an export centre for refined output from the Gulf.
"With a capacity as large as 300,000 barrels a day, the majority of the new refinery's output will be exported," said Mr Pornchai.
However, some output will serve domestic demand which has started to catch up with the existing supply. The maintenance shutdown of Esso's refinery led to a substantial increase in the country's oil imports last month, he noted.
Currently, seven refineries are in operation, with a combined capacity of one million barrels daily.
"We have targeted striking a balance between domestic oil consumption and the existing refining capacity of one million barrels a day by 2006, after which the demand will begin to outstrip the supply," Mr Pornchai said.
Thai Oil is the country's largest refiner at 220,000 barrels a day. It plans to raise its capacity to 270,000 barrels after listing on the stock market next year.
As well, Thai Petrochemical Industry (TPI) plans to add another 20,000 barrels a day to its refinery now running at 180,000 barrels. Rayong Refinery -and Star Petroleum Refining have daily output of 145,000 barrels, each, Esso 130,000, Bangchak Petroleum 120,000 and Hayong Purifier 35,000 barrels.
Meanwhile, the Si Racha Hub is facing some technical and human resource problems, which could delay the progress of a plan to establish an oil trading centre there. The free zone was officially opened early this year, but PTT Plc is the only trader operating there at present.
Last month's volumes handled by PTT were 1.6 million barrels of crude and 1.7 million barrels of refined oil.
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