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Thailand’s Energy Strategies. Energy Situation Energy supply is available BUT with much higher prices. Thailand still depends heavily on energy imports,

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Presentation on theme: "Thailand’s Energy Strategies. Energy Situation Energy supply is available BUT with much higher prices. Thailand still depends heavily on energy imports,"— Presentation transcript:

1 Thailand’s Energy Strategies

2 Energy Situation Energy supply is available BUT with much higher prices. Thailand still depends heavily on energy imports, especially oil.

3 ดีเซล เบนซิน น้ำมันดิบดูไบ Crude and Petroleum Product Prices in 2006 Forecast on the Dubai crude price (Deutsche Bank, Morgan Stanley, Goldman Sachs) During Jul-Dec 2006, the price will be about 68-70 US$/barrel. In 2007, the price is projected to slightly increase to be about 70-71 US$/barrel. Diesel Gasoline Dubai crude Energy Situation Dec06 Jun07 70 US$/barrel 71 US$/barrel

4  Shaken stability of Thailand’s economic conditions  Trade deficit  Adverse impact on the people as the commodity prices increase Impact of the Oil Price Crisis

5 Objectives of the Energy Plan To reduce dependency on energy imports To enhance the national energy security To ensure that energy development is gearing towards sustainable development

6 1 st Strategy: To Reduce Dependency on Energy Imports Measures: 1.1 : Diversify fuel sources & types, focusing on indigenous energy resources 1.2 : Develop and promote the use of alternative energy 1.3 : Improve energy efficiency of the country

7 Measure 1.1 : Diversify fuel sources & types, focusing on indigenous energy resources Promote the Use of Natural Gas –to replace petroleum fuels in the transport sector (“NGV Project”) –to replace fuel oil in the industrial sector

8 Promotion of NGV utilization to replace petroleum fuels in the transport sector Measure 1.1 : Diversify fuel sources & types, focusing on indigenous energy resources

9 Target : Increase the Number of NGV Stations RegionPresent 2006 2007200820092010 Q3Q4 Bangkok & vicinities5380127197247270325 Central14204564748090 North--111717454587112 Northeast--9245858104114 South-2818267999 Accumulated Stations 67102200320450620740 Target No. of NGV vehicles (thousand) 145151171300396500 Promotion of NGV Utilization Success Indicators: 1)Construction sites for 200 stations have already been identified. 2)200 compressors has been procured; deliveries are scheduled in Q3 and Q4 of 2006. 3)140 trucks for NGV transportation have been procured. 4)Other oil companies are encouraged to establish NGV stations, i.e. Bangchak, Shell, Esso, Caltex and Petronas by providing incentives, e.g. increased marketing margin from 0.83 baht to 2.33 baht/kg (except for PTT stations).

10 Vehicle Type 20062007200820092010 RoadmapRevisedAccumulated Vehicles (thousand/yr) Gasoline-engine Vehicles Taxis/ Tuk-Tuks/ Sedans/ Government Fleets 33.543.9679139179219 Diesel-engine Vehicles BMTA Buses/ Inter-province Buses/ Concessionary Buses 6.184.077.89.3811.2812.62 Trailers/ Trucks 33.062.39253139.148.1 Pick-ups/ Vans 33.060.7858.6120165219 Total Diesel-engine Vehicles39.57.2392161217281 No. of Vehicles (Accumulated) 735151171300396500 Target : Increase the Number of NGV Vehicles (revised) Remarks: The Plan was revised due to the following: The expansion of NGV stations has been delayed as promotion of NGV vehicles is boosted worldwide, resulting in shortage of equipment and machinery required for the construction of NGV stations. Tax incentives to promote NGV utilization were approved in May 2006. Requests have been received for the installation of NGV kits for 1,785 government vehicles. Of this, 695 vehicles have been sent in and installation has been made for 668 vehicles. There are some technical problems for NGV kit installation for diesel-engine pick-ups. The number of NGV kit installation operators increases to 38, with 169 workshops and 14 inspectors. Promotion of NGV Utilization

11 Tax Measures Customs Tax Exemption : equipment/cylinders until end 2008 : NGV engines Excise Tax Reduction : OEM from 30% to 20% : Retrofits from 30% to 22%, but not exceeding 50,000 baht Investment Privileges via BOI Revolving Fund Energy Conservation Promotion Fund: 2,000 Million Baht : Engine change - BMTA Buses: Credit line 1,700 M Baht, for 1,477 buses -Inter-province Buses: Credit line 300 M Baht, for 300 buses PTT 5,000 Million Baht : Engine modification/change for private operators of transport services Approved Supportive Measures for NGV Promotion Promotion of NGV Utilization

12 Measure 1.1 : Diversify fuel sources & types, focusing on indigenous energy resources Promotion of NG utilization to replace fuel oil in the industrial sector

13 Initial Phase Target by 2011 Industrial Estates in: Bangkok and vicinities Songkhla (Cha-lung) Chonburi (Pinthong, Welgro) Rayong (Pha-daeng) Ayuddhaya (Saharattana Nakhorn, Hitec) Samut Sakhorn, Singburi, Ratchaburi, etc. 2005: NG use = 2,300 M litres of fuel oil equivalent 2006: NG use = 2,900 M litres of fuel oil equivalent 2007: NG use = 3,500 M litres of fuel oil equivalent Entirely replace fuel oil MMSCFD 4% Target in 2006 308 MMSCFD Utilization of Natural Gas to Replace Fuel Oil in the Industrial Sector AVERAGE 05JAN 06FEB 06MAR 06

14 Promotion of Gasohol Utilization Measure 1.2 : Develop and promote the use of alternative energy

15 Cabinet Resolution of 17 May 05 Approving the discontinuation of Octane 95 Gasoline Distribution as from 1 Jan 07 Ethanol Production (1.1 M litres/day)  Currently, 4 plants are in operation, with a total capacity of 580,000 litres/day and actual production at 490,000 litres/day.  By Dec 2006, 4 more plants will be on stream, with a total capacity of 510,000 litres/day, using: - cassava : 210,000 litres/day - molasses : 300,000 litres/day Current Status Current Gasohol Utilization  Gasohol Utilization = 3.5 M litres/day  3,103 service stations There are 30 new applicants for ethanol plant construction. Biofuel Development & Promotion Committee (BDPC) is urging the plants with licenses granted to submit documents on the equipment procurement plan + down payment + LC placement by 31Jul06; otherwise, the licenses will be revoked. Promotion of Gasohol Utilization

16 Remarks: - During Sep-Nov06, the supply will drop as Thai Agro Energy has notified of its planned shut down due to raw material shortage. - For the plants using cassava, the actual production is expected at 50% of the capacity in the 1 st year and 75% in the 2 nd year. Demand & Supply 2006–07 Installed Capacity Ethanol Requirement to produce Gasohol 95 Actual Production as planned Actual Production in case new plants are delayed for 2 months Promotion of Gasohol Utilization

17 Action Plan until end of 2006 Speed up the 4 new plants to be on stream by Dec 06 Increase the number of Gasohol 95 stations nationwide Speed up co-investment between Thai Oil & Liquor Distillery Organization in ethanol production from cassava at 500,000 litres/day Promote “Contract Farming” between Ethanol Plants using cassava and Farmers (Pilot project for 3 plants) Monitoring Agency Promotion of Gasohol Utilization MOEN MOEN/Oil Companies MOEN/MOF MOAC/MOEN/ Bank of Agriculture & Agricultural Cooperatives (BAAC)/MOI

18 1.6 2.1 2.2 1.1 0.42 Average ethanol requirement to produce gasohol Action Amount (M litres/day) Replace MTBE by Ethanol 201120102009 2008 2009: distribute E10 nationwide Improve cassava yield 5 tons/rai and sugarcane 15 tons/rai 8.18.38.5 8.68 4 Gasohol 95 (average) Improve cassava yield 10 tons/rai and sugarcane 20 tons/rai Gasohol 91 (average) 3812.412.7 130.2 20072006 2.1+1.6 0.46 Average actual ethanol production Total saving from oil import reduction (Billion Baht/yr) 1215 168 3 NB:- Domestic raw materials will be sufficient if the improvement of yield/rai is achieved as planned by the MOAC. - MOEN has liaised with automobile manufacturers and oil traders regarding the policy to promote the use of E10-E100 in 2007. 2008: distribute E100 in certain areas Gasohol Road Map: Long Term (2007-11) Ethanol Hub Agency MOEN MOAC MOEN/ BDPC Awaiting licenses: 30 plants Promotion of Gasohol Utilization

19 Ethanol Production Plants Operators Installed Capacity (litres/day) Actual Production (litres/day) 20062007 1. Operators currently in operation580,000490,000567,500 1.1 Thai Alcohol Plc.200,000 1.2 Thai Agro-Energy Co.150,000120,000 1.3 Khon Kaen Alcohol Co. 100,000 (150,000 Dec06) 100,000150,000 1.4 Thai Nguan Ethanol Co.130,00070,000 97,500 2. Operators whose plant construction is nearly completed and operation will start in 2006 510,000405,000442,500 2.1 International Gasohol Corp. * Jul 06150,00075,000112,500 2.2 PetroGreen Co.  Dec 06200,000 2.3 Ekkarath Pattana Co.  Dec 06100,000 2.4 Fah Kwanthip Co.  Dec 0660,00030,000 รวมกำลังผลิต ณ ธ. ค. 49 (1) + (2) 1,090,000895,0001,010,000 PetroGreen Co.Fah Kwanthip Co. Ekkarath Pattana Co. * The plant uses cassava as raw material, with estimated actual production at 50% in 1 st year and 75% in 2 nd year. Promotion of Gasohol Utilization

20 Ethanol Production Plants Operators Installed Capacity (litres/day) Actual Production in 2007 (litres/day) 3. Operators whose plant construction will be completed in 2007 750,000575,000 3.1 E.S. Power Co., Sakeo province150,000 3.2 Ratchaburi Ethanol Co., Ratchaburi province150,000 3.3 K.I. Ethanol Co., Nakhorn Ratchasima province100,000 3.4 Siam Ethanol Chaiyaphum Co., Chaiyaphum province100,00050,000 3.5 Boon-a-nek Co., Nakhorn Ratchasima province250,000125,000 Total production capacity in 2007 (1+2+3)1,840,0001,585,000 Thai Oil Plc. & Liquor Distillery Organization have joint- ventured in an ethanol plant, with a capacity of 500,000 litres/day – scheduled to complete in early 2008 2,340,0002,085,000 Remarks: Another 35 operators are under consideration by the Biofuel Development & Promotion Committee, with a total capacity of 10.4 M litres. Thai Alcohol Plc. Khon Kaen Alcohol Co. Thai Nguan Ethanol Co. Promotion of Gasohol Utilization

21 Promotional Measures 1.1 Aug 06: revoke the licenses of new plants that fail to operate as scheduled and liberalize the ethanol production business. 2.In case the construction of 4 new ethanol plants scheduled to start operation in Dec06 is delayed, there will be 2 options: 2.1 Postpone the removal of Gasoline 95 from the market from 1 Jan 07 to 1 Apr 07 2.2 Import 30 M litres of ethanol in Nov 06 to build up the stock 3.Speed up promotion of Gasohol 91 as from 2007-08, and allow export of surplus ethanol from 2009 onwards. Monitoring Agency Promotion of Gasohol Utilization BDPC MOEN BDPC/MOEN

22 Promotion of Biodiesel Utilization Measure 1.2 : Develop and promote the use of alternative energy

23 Biodiesel Production No. of Plants B100 (certain) 4*4*6840 Installed Capacity (M litres/day) 0.851.652.158.50 Palm Oil Demand (M tons/yr) 0.060.140.422.47 Raw Material (Palm Oil) Nationwide Supply (M tons/yr) 0.370.670.422.41 Supply- Demand 0.310.530-0.06 Reduce Import ** (Billion Baht/yr) 1.26.19.355 * Used cooking oil is mainly used as raw material; the quality of B100 does not meet the specifications yet. ** Ex-refinery diesel price (30Jun06) = 21.12 Baht/litre 2012201120102009200820072006 Road Map Promotion of Biodiesel Utilization

24 Current Status Biodiesel Specifications Commercial scale – announced 11Jul05 & effective 23Sep05 Community scale for agricultural machinery – announced 30Jun06 & effective 21Jul06 Commercial Biodiesel 3 production plants of B100, with a total production capacity of 350,000 litres/day (SunTech 500,000 litres/day – COD Jul06) 35 service stations for B5 (PTT & Bangchak), with a total sale of 100,000 litres/day  sale to lorries & pick-up trucks Retail price of B5 is lower than diesel price at 0.50 Baht/litre New Areas for Oil Palm Plantation (1 hectare = 6.25 rai) Target in 2006 720,000 rais Palm plantation 05/06 620,000 rais Credit granted by Bank of Agriculture & Agricultural Cooperatives 2,583 M Bt Community-Based Biodiesel (Pilot Project) Production Capacity (each):100 litres/day Raw Materials: used cooking oil, palm oil, jatropha oil Target Dec 2006: 70 Communities Production: 7,000 litres/day Replace diesel 2.3 M litres/yr Promotion of Biodiesel Utilization

25 Action Plan Jul – Dec 2006Agency 1.B100 Plants PTT (via PTTCH) is constructing a B100 plant, with a capacity of 600,000 litres/day (COD Dec 07) and is negotiating on joint-venture with 2 private operators, with a total capacity of 500,000 litres/day. MOEN jointly with MOAC use excess raw palm oil to produce B100 at 300,000 litres/day for sale to fishing boats, trucks and service stations. Service stations of PTT/Bangchak will increase from 35 to 200 stations by Sep 06. MOEN/PTT MOAC/Private Operators Oil Companies 2. Plantation Set incentive measures for farmers to grow oil palm instead of rubber trees. Promote “Contract Farming” between Farmers - CPO Extraction Plants - B100 Plants. Solicit with neighboring countries for oil palm plantation at about 200,000 rais in 2007. MOEN/BAAC MOAC/MOEN/ BAAC/MOI NESDB/MOEN/MOAC/ MFA/MOC/MOF 3. Community-Based Biodiesel to replace diesel at 2.3 M litres/yr Increase community-based biodiesel to 70 stations under the “One District, One Community-Based Biodiesel” Project. MOEN/MOAC/MOI/ MOST/ Local Administration Organizations Promotion of Biodiesel Utilization

26 Long-Term Plan (2007-2012)Agency 1. Raw Materials for Production - Speed up new domestic oil palm plantation 3.7 M rais. - Solicit for new oil palm plantation in neighboring countries, 1 M rais. - Promote Contract Farming between Farmers-CPO Extraction Plants- B100 Plants. MOAC NESDB/MFA/MOAC/ MOEN/MOF MOAC/BAAC/MOEN/MOI 2. Production -Encourage private investors to establish B100 plants to achieve the targeted production of 8.5 M litres/day. -Increase community-based biodiesel to 730 stations by 2008 under the “One District, One Community-Based Biodiesel” Project. Each Local Admin Organization procures a location for system installation & feedstock and MOEN/MOST provide biodiesel production equipment & technical advice (production cost ~16-20 Baht/litre). MOEN/MOI (Industry) MOEN/MOAC/MOI/MOST/ Local Admin. Org. 3. Distribution - Promote the use of biodiesel with a mixture ratio > B10 - Increase biodiesel service stations nationwide MOEN/Oil Companies/ Automobile Manufacturers 4. R&D - Trial application of B10-B100 to automobiles and other vehicles - Value-added creation from by-products via relevant downstream industries MOEN/MOST/ Academic Institutes/ Automobile Manufacturers Action Plan established Promotion of Biodiesel Utilization

27 CPO tons/yr CPO ส่วนเกินบริโภค ปี 2549+2550 Surplus to consumption (incl. export) Domestic Plantation Neighbors Promotion of Biodiesel Utilization CPO Demand Demand / Supply Demand CPO Surplus 2006+2007 200720102011201220082009

28 Strategy for Palm Oil Procurement for Biodiesel Production Actual and Expected No. of Plants 6810152040 CPO Demand 136,047418,605581,395872,0931,133,7212,470,930 Supply (without import) 1. CPO Surplus to consumption * 674,425374,363446,621448,325449,571450,323 2. CPO Domestic Plantation Plan (DPP) -34,020230,850586,7101,185,6241,778,976 3. CPO Surplus + DPP 674,425408,383677,4711,035,0351,635,1952,229,299 Supply (with import) 4. CPO DPP+Plantation in Neighboring Countries (Compared with Former Plan) 287,484 34,020 370,903 230,850 611,482 639,191 1,110,679 1,283,559 1,412,818 1,959,439 2,148,997 5. CPO Surplus + DPP + Neighboring Countries (New Option) 674,425408,383677,4711,087,5151,733,1302,409,762 Ton/yr 200720082009201020112012 Forecast of Demand and Supply that is believed to be practical and 5 options for palm oil procurement for biodiesel production. * CPO Surplus to consumption = Actual Palm Oil Product + Stock at the beginning of the year – Domestic Consumption (excl. export)

29 1.Allocate money from the ENCON Fund (increase the contribution rate by 6 Satangs/litre) to promote RE of all types. 2.Set incentive measures for farmers to grow oil palm instead of rubber trees and increase the palm yield from 2.7 to 3.5 tons/rai. 3.Promote oil palm plantation in neighboring countries by giving assistance in seeking sources of fund. 4.Provide soft loans, totaling 1,200 MBt, to investors of commercial-scale biodiesel plants. 5.Provide 100 MBt to be the operating budget for “One District, One Biodiesel” Project, totaling 730 stations. Promotional Measures Monitoring Agency Promotion of Biodiesel Utilization MOEN MOAC MOAC/MOEN Financial Institutions (FI) MOEN/FI MOEN/MOST/MOI/ Local Admin. Org.

30 Measure 1.3 : Improve energy efficiency of the country Transport Sector –Restructure the logistic system of the country –Improve & promote the use of mass transit systems Industrial/Commercial/Service Sector –Use pricing measures and legally mandatory measures, e.g. issuance of energy efficiency standards to improve energy efficiency of the production process in the industrial sector, together with the application of incentive measures General Public Sector –Foster energy conservation awareness –Use pricing measures together with legal measures

31 2 nd Strategy: To Enhance the National Energy Security Measures: 2.1 :Manage the production of key energy types to ensure greater efficient fuel diversification 2.2 :Increase and promote exploration of energy resources overseas 2.3 :Seek for international cooperation in energy development, at both bilateral and multilateral levels 2.4 :Speed up study on nuclear fuel to be prepared for its application in the long term

32 Measure 2.1: Manage key energy production for greater efficient fuel diversification Key Energy Management: Power

33 33 MW Yr (43,558 MW) (38,241 MW) 6.5 6.4 6.6 6.5 6.4 6.5 6.4 4.7 5.0 5.5 5.0 5.5 New GDP GDP Load forecast has been revised due to the economic slowdown. Power demand growth rate is adjusted downwards from initially forecasted. 2011 2016 2,507 MW 5,317 MW Revised Load Forecast: Growth rate decreased from initial forecast Key Energy Management: Power Key Energy Management: Power

34 34 Fuel Option in Power Generation GWh Yr 72% 7% 10% 6% 48% 10% 7% 20% 12% 3% 31% 14% 5% 29% 18% 3% 6% 68% 17% 8% Hydro Natural Gas (LNG, Pipe Gas) Lignite Imported Coal Others Key Energy Management: Power Key Energy Management: Power Others Imported Coal Lignite Natural Gas (LNG, Pipe Gas) Fuel Oil 0607 060809101112131416151718192021

35 x Ft will not increase until Jan 07 Implementing Guidelines Energy conservation measures help slowdown the power demand growth rate to  4% Increase the use of natural gas from: -Phu Hom basin to fuel Nam Phong Plant in Oct 2006, reducing the use of fuel oil by 60 M litres/month. -Gulf of Thailand/Myanmar Accelerate the use of coal at the IPP plant, BLCP, reducing the use of fuel oil by 110 M litres/month. Key Energy Management: Power Key Energy Management: Power

36 Road Map 1.Reduce the use of fuel oil/diesel so as not to affect the Ft. 2.Diversify fuel types in power generation, via: 2.1Import coal in 2013, starting with power generating capacity at 700 MW. 2.2Import hydropower from neighboring countries, by encouraging EGAT/Thai investors to invest in hydropower projects in those countries. Lao PDR2,200MW, during 2011-2015 Myanmar3,000MW, during 2013-2021 (1 st project is Hutgyi) PR China3,000MW, during 2016-2017 Key Energy Management: Power Key Energy Management: Power

37 Hutgyi MALAYSIA PR China Myanmar Cambodia Vietnam INDIA 6,100 MW (2013-21 = 3,000 MW) 3,000 MW (2016-17) ลาว Thailand LPDR Hydropower from neighboring countries 4,050 MW (2011-15 = 2,200 MW) Key Energy Management: Power Key Energy Management: Power

38 Estimation of EGAT’s Long-Term Capital Investment 45,970 9,185 36,785 36,7852008 EGAT’s Long-Term Capital Investment 40,163 40,163 22,375 22,375 10,193 10,193 Generation 19,297 8,328 7,777 Transmission 2010Total 59,460 2009 30,703 2007 17,970 2006 Total Year 39,024 39,024 22,346 61,370 148,540 148,540 66,933 215,473 Unit: M Baht Key Energy Management: Power Key Energy Management: Power

39 Key Energy Management: Natural Gas Measure 2.1: Manage key energy production for greater efficient fuel diversification

40 Plan of Natural Gas Demand Showing Continuous Growth EGAT / IPP / SPP NEW IPP (Gas 70%) Industry NGV GSP Unit: MMSCFD 3,145 74% 9% 62%52% 10% 7% 17%20% 5,015 15% 13% 20% CAGR 12% CAGR 4%  Growth Rate Increases:  Short term (2006-2010) 12%  Long term (2011-2020) 4%  Expand the market that optimizes the value creation of natural gas:  Industries (CHP)/Transport (NGV)  Gas Separation Plants/ Petrochemical GDP Growth 5.2% GDP Growth 5.5% 7,350 Source: PTT/ EPPO/ Draft PDP 2006 Key Energy Management: Natural Gas Key Energy Management: Natural Gas 20062008201020122015202620282030

41 Unit: KBD Oil Coal/Lignite Electricity Renewable 416 915 19% 29% 21% 11% 26% 21% 22% 20% 9% CAGR 5% Natural Gas (CAGR 10%) Year200620102020 MMSCFD2825201,080 Fuel oil replacement (M litres/yr) 2,6004,80010,000 Value of fuel oil replacement (M Baht/yr) 33,00051,450117,000 Value derived from EE improvement (M Baht/yr) 8884,81513,610 Plan for Value Creation in the Industrial Sector Energy Demand in the Industrial Sector by Fuel Type Projects in progress 297 MW  Suvannabhumi Airport (2006) 52 MW  PTTUT 1-2 (2008-09)225 MW  Government Office Centre (2008) 10MW  Future Park Rangsit (2007) 5MW  Energy Complex (2009) 5MW Projects under FS 720MW  PTTUT 3-4225MW  Sahaviriya Steel Factory220MW  Samui Island100MW  Eastern Seaboard Industrial 150MW Estates  Bangchak Oil Refinery 20MW  Siriraj Hospital 5MW High Potential (25 projects)259MW Expansion of Efficient Use of Natural Gas via the Use of Combined Heat & Power (CHP) 15% 26% 17% 21% 22% Key Energy Management: Natural Gas Key Energy Management: Natural Gas 200520082011201420172020

42 Plan for Expansion of Distribution Pipeline System to Promote Use of Natural Gas in the Industrial & Transport Sectors  Expand City Gas  Suvannabhumi – Suksawad - Siriraj  Sai Noi – Suksawad - Siriraj  Samut Prakarn – Bang Chak  Expand to Regional Estates/Industrial Areas  Central Region  Ayuddhaya (Nakhon Luang district)  Samut Sakhon (Kratumbaen district)  Prachinburi (Gateway Estate, Sahapattana Group)  Eastern Region  Rayong (TPI)  Western Region  Ratchaburi (Ratchaburi Industrial Estate)  Southern Region  Songkhla (Chalung Industrial Estate) Key Energy Management: Natural Gas Key Energy Management: Natural Gas

43 GSP 6 GSP 7&8 & Ethane Plant 2009 2012-14 3 rd Wave 3 rd Wave Phase 1 Phase 2 Value added (Billion Baht) 42.5 47.3 Value of investment  Billion USD 2.8 2.4  Billion Baht* 110.8 96.9 Revenue Estimate: 288 Billion Baht/yr @ 2018 GSP Expansion LPG/Ethane Production 5,317 3,680 4,524 2,4509322,450 3,6272,296 Ethane LPG Unit: K Ton/Yr 491 1,465 GSP 1-5 GSP 6 Ethane Plant GSP 7+8 CAGR 8% GSP 6/ Ethane Plant GSP 7 (LPG Only) GSP 7+8 (Ethane Extraction) Unit: MMSCFD  Increase gas separation capacity to accommodate the petrochemical industry development Plan for Value Creation in the Petrochemical Industry/ LPG Export Remarks: * Exchange Rate at 40 Baht : 1 USD Key Energy Management: Natural Gas Key Energy Management: Natural Gas 200520082011201420172020 2006201020122015

44 Jun 2006 2007 2008 2009 2010 3,150 Now Unocal Add 100 (Jun) Unocal Add & Pipeline No. 3 70 (Aug/ Sep) Reduce Pressure @ ERP/ECP 65 (Sep) 20 (Sep) Reduce Border Pressure @ Myanmar Phuhom 108 (Oct) 200 (Jun) A18 Early Gas +200 (Apr) A18 330 (Jan) Arthit 60 (Jan) Arthit Add (270+60) (Jul) B17 Yetagun Add 100 (Jul) 150 (Jan) A18 Phase 3 330 (Oct) 250 (Jul) Unocal Add S. BKT หน่วย : ล้าน ลบ.ฟุต/วัน FPSO Plan for Natural Gas Supply: Short-Term Jul 2007 Natural Gas from the Gulf of Thailand (2,213 MMSCFD) until the capacity of the offshore Pipeline No. 3 is used up. Use of FPSO to speed up increase of NG supply from the Gulf of Thailand (Arthit/B17) Gulf of Thailand Myanmar M7/M9 LNG/Regional Gas 72% 70% 52% 28% 21% 12% 5% 4% 6% 30% Plan for NG Supply Key Energy Management: Natural Gas Key Energy Management: Natural Gas

45  LNG/Regional Gas to meet the increasing demand (starting 2011) MMSCFD - LNG (5-10 MTA) 700-1,400 Middle East (Iran/Qatar) Malaysia Australia (Woodside) Russia (Sakhalin) - Regional Gas M7/M9 /A1/600 Other Myanmar Natuna 1,000  Additional Gulf to replace decreasing NG in the Gulf of Thailand (starting 2022) - Arthit 3110 - Pailin add132 - Thailand-Cambodia 1,000 Overlapping Area Plan for Natural Gas Supply: Medium/Long Term Key Energy Management: Natural Gas Key Energy Management: Natural Gas

46 Plan for the Expansion of Natural Gas Pipeline Networks Expansion of Domestic NG Pipeline Networks (MMSCFD) East Coast Year 2011  Offshore 2,010 3,910  Onshore1,200 3,700 West Coast  Onshore 1,265 1,760 Distance3,000 4,400 km Expansion of Cross-Border NG Pipeline Networks  Accommodate domestic demand in the long term  Preparedness to be “Gas Hub”  Natuna (Indonesia) 1,600 km  A1, M7/M9 (Myanmar) 1,200 km  OCA (Thailand-Cambodia Overlapping Area) Key Energy Management: Natural Gas Key Energy Management: Natural Gas

47 Project on the LNG Receiving Terminal  Location: Map Ta Phut Industrial Estate (MapTa Phut Industrial Port, Phase 2)  Capacity: - Initial phase 5 M Tons/year (700 MMSCFD) as at 2011 - Long Term 10 M Tons/year (1,400 MMSCFD) as at 2018  Lining of Onshore Pipeline No. 4 (42”), 1,300 km, linking with the Terminal and the existing pipeline system/New IPPs  Value creation from the cool of LNG - GSP 7 and 8 - Power Plants/Petrochemical Industry Project Site: Map Ta Phut Industrial Port, Phase 2 Key Energy Management: Natural Gas Key Energy Management: Natural Gas

48 Investment in energy & petrochemical industries is increasing continuously. Pipeline System NGV JV ธุรกิจ อื่นๆ โรงแยก ก๊าซฯ ระบบท่อฯ NGV JV ธุรกิจ อื่นๆ โรงแยก ก๊าซฯ 2006 2007 79,620 64,142 Investment in the next 5 yrs 307,346 Unit: M Baht 604,607 PTT PTT Subsidiaries GAS 222,726 OIL 12,961 JV 69,349 Others 2,310 GAS 222,726 OIL 12,961 PTTEP 142,280 Petchem 137,080 Refining 89,560 Gas 79% Gas 65% 72% 37% 23% 4% 1% 2% 24% 22% 15% Key Energy Management: Natural Gas Key Energy Management: Natural Gas

49 Measure 2.2: Increase and promote exploration of energy resources overseas Encourage “National Champions” in both petroleum and electricity generation industries to invest or joint venture in energy development projects in foreign countries.

50 Measure 2.3: Seek for international cooperation in energy development, at both bilateral and multilateral levels Speed up energy cooperation projects to enhance energy supply for Thailand, through the bilateral discussion framework with neighboring countries. Seek for cooperation in the energy technology development, via the multi-lateral discussion framework, and forge ahead Thailand’s energy policies in international forums.

51 Measure 2.4: Speed up study on nuclear fuel to be prepared for its application in the long term Seek cooperation with countries with expertise in nuclear technology Human resources development to accommodate future nuclear projects

52 Measures: 3.1 :Promote participation of the general public in energy development projects 3.2 :Improve and promote the protection against, and the management/control/alleviation of pollutions resulting from energy development activities 3 rd Strategy: To Ensure that Energy Development is Gearing towards Sustainable Development

53 The World’s Largest Crude Reserve –Crude reserve: 743 billion barrels or 61.9% of the world crude reserve. The World’s Largest Crude Producing Region –Crude production of the Middle East, as at the end of 2005, is 9.17 billion barrels/year, accounting for 31% of the total world crude production. Remarks: As at the end of 2003, World crude reserve = 1200.7 billion bbl World crude production = 29.6 billion bbl/yr Impact of Political Tension in the Middle East Influential Factors of the ME over the World Energy Situation

54 In case of a slight oil shortage (The supply decreases but is not less than 80% of the averaged oil demand per day.): –The government will be lenient with regard to the mandatory oil stockpile, which will be released to cover the domestic demand, under specified measures and for a period of time as deemed appropriate. Thailand ’ s Energy Preparedness in response to the Political Tension in the ME Impact of Political Tension in the Middle East

55 Largest Source of Crude Import to Thailand Importance of the Middle East to Thailand Middle East 79.7 % Africa 3.0 % Asia Pacific 17.0 % Others 0.3 % SourceAmount (M. Litres) Share (%) Africa1,415.093.0 Middle East 38,301.6579.7 Asia Pacific 8,175.7417.0 Others141.090.3 Total 48,032.57100.0 Share of Crude Import to Thailand by Production Source Impact of Political Tension in the Middle East

56 Crude Import to Thailand from the Middle East (by country) CountryAmount (M. Litres) Share (%) United Arab Emirates (UAE)15,987.6441.7 Iraq656.421.7 Kuwait243.900.6 Oman7,214.4718.8 Qatar1,968.875.1 Saudi Arabia9,379.6924.5 Yemen, DEM. (South)178.750.5 Yemen2,671.917.0 Total38,301.65100.0

57 In case of a severe oil shortage (The available supply is less than 80% of the averaged oil demand per day): –The government will intervene to control the overall pricing and consumption amount, via application of 2 major measures: Supply Side & Demand Side. Preparedness Measures: Supply Side Utilization of oil from domestic resources. Under the Petroleum Act, the government will limit crude oil exports of concessionaires of crude production from domestic resources, of which the capacity is ~60,000 bbl/day. Crude oil produced must be sold only to domestic oil refineries. Request activation of the mechanism under the ASEAN Petroleum Security Agreement (APSA) & have negotiations done to be ready for the application of APSA to oil producing countries in ASEAN, e.g. Indonesia, Malaysia and Brunei. Request cooperation from Transnational Corporations in the oil business in Thailand, e.g. Shell, Esso and Caltex, to get prepared to obtain additional quota of both crude and refined products, from their respective parent companies for distribution in Thailand during the oil shortage. Use the Government to Government negotiation mechanism to seek for cooperation/assistance in oil trading/exchange with each other. Impact of Political Tension in the Middle East Thailand ’ s Energy Preparedness in response to the Political Tension in the ME

58 Preparedness Measures: Demand Side The Objective of Demand Side Measures is to optimize oil utilization efficiency, with no excess impact on the economic conditions and quality of life of the people. The government will determine the oil rationing for economic sectors, divided into:  Economic group requiring special attention of the government, i.e. industrial, transport, fishery and agricultural sectors – a focal monitoring body will be assigned to manage the rationing, which may be the Ministry of Energy together with Article 7 Oil Traders.  General group, i.e. oil consumers in all regions – the rationing will be based on the demand by province and the Provincial Governors will be assigned to determine the oil rationing priorities within their respective provinces. For both measures, concerned government agencies and Article 7 Oil Traders will prepare key data/information, e.g. the amount of demand and of oil stockpiles at oil depots situated in various regions, for the consideration of oil rationing for each economic sector. Impact of Political Tension in the Middle East Thailand ’ s Energy Preparedness in response to the Political Tension in the ME

59 CONCLUSION Thailand as a small country in South-east Asia cannot escape the impact of world energy situation. Thailand depends heavily on energy supplies from abroad, especially crude oil from the Middle East. Situation in the world energy market has direct impact on Thailand in a few day.

60 CONCLUSION Thailand is now working very hard on other fuels such as biofuels (Ethanol & Bio-diesel) and NGV which can be produced locally to help reduce dependency on world supply of energy. It might be small but worth trying. In the long run, nuclear might be the final answer for Thailand when other fuels are depleted.

61 Energy Policy and Planning Office Ministry of Energy Thailand


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