Thailand's PTTEP buys full control of offshore gas block
The deal for Block A-18 in the Malaysia–Thailand Joint Development Area (MTJDA) was signed with Hess (Bahamas) and Hess Asia Holdings, both now owned by Chevron following a recent merger with Hess Corp, PTTEP said in a statement.
The acquisition gives PTTEP 100% of the outstanding shares in Hess International Oil Corp, which holds a 50% participating interest in Block A-18, the exploration arm of PTT Plc said.
The deal comes as Chevron restructures globally to streamline operations and reduce costs, a process that could involve laying off 20% of its workforce by the end of next year. Chevron is also seeking buyers for its 50% stake in its Singapore refinery, Reuters reported in June.
PTTEP said natural gas from Block A-18 is fundamental to power generation for southern Thailand. The block produces about 600 million standard cubic feet of gas per day, which is equally distributed to Thailand and Malaysia.
'PTTEP is pleased to further expand our operations in the MTJDA, which is recognised for its petroleum potential and strategic significance to Thailand's energy security,' chief executive officer Montri Rawanchaikul said in the statement.
The MTJDA covers 7,250 square kilometres in the southern part of the Gulf of Thailand and is a key source of natural gas and condensate for Thailand and Malaysia, according to the statement.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Bangkok Post
2 days ago
- Bangkok Post
Thailand's PTTEP buys full control of offshore gas block
SINGAPORE - PTT Exploration and Production (PTTEP) of Thailand has acquired full ownership of an offshore oil block in the Gulf of Thailand in a $450-million transaction with units of US-based Chevron. The deal for Block A-18 in the Malaysia–Thailand Joint Development Area (MTJDA) was signed with Hess (Bahamas) and Hess Asia Holdings, both now owned by Chevron following a recent merger with Hess Corp, PTTEP said in a statement. The acquisition gives PTTEP 100% of the outstanding shares in Hess International Oil Corp, which holds a 50% participating interest in Block A-18, the exploration arm of PTT Plc said. The deal comes as Chevron restructures globally to streamline operations and reduce costs, a process that could involve laying off 20% of its workforce by the end of next year. Chevron is also seeking buyers for its 50% stake in its Singapore refinery, Reuters reported in June. PTTEP said natural gas from Block A-18 is fundamental to power generation for southern Thailand. The block produces about 600 million standard cubic feet of gas per day, which is equally distributed to Thailand and Malaysia. 'PTTEP is pleased to further expand our operations in the MTJDA, which is recognised for its petroleum potential and strategic significance to Thailand's energy security,' chief executive officer Montri Rawanchaikul said in the statement. The MTJDA covers 7,250 square kilometres in the southern part of the Gulf of Thailand and is a key source of natural gas and condensate for Thailand and Malaysia, according to the statement.
Bangkok Post
2 days ago
- Bangkok Post
All eyes on Trump's August 1 deadline
As global markets continue to digest US President Donald Trump's latest trade announcements, attention now turns to the rapidly approaching Aug 1 deadline that could reshape Southeast Asia's economic landscape. While recent bilateral deals have provided some clarity, Thailand faces the dual challenge of securing favourable trade terms with the US while managing an unexpected military escalation with Cambodia. Trump's tariff template The MSCI World Index of equities has continued its upward trajectory following Trump's announcement of new trade agreements that appear to establish a regional framework. Japan secured a 15% tariff rate (down from 24%), while the Philippines and Indonesia both achieved 19% rates, down from 20% and 32% respectively. These developments, combined with Vietnam's earlier 20% agreement, suggest Southeast Asian nations may face similar tariff levels. The US-Japan deal, which Trump dubbed "the largest trade deal in history", reveals the administration's negotiating blueprint. Japan's commitment to establish a $550-billion US investment fund, alongside promises to purchase 100 Boeing aircraft and billions of dollars' worth of defence equipment annually, demonstrates the scale of concessions required to secure preferential rates. However, the agreement has drawn sharp criticism from US automotive manufacturers, who argue that reducing tariffs on Japanese cars fails to address the core trade imbalance while disadvantaging American producers. With automobiles and auto parts comprising 80% of the US-Japan trade gap, industry representatives question whether the deal serves American interests. EU prepares for trade war Meanwhile, the European Union is preparing its most powerful trade retaliation tool -- the Anti-Coercion Instrument -- should Trump proceed with 30% tariffs on European goods. The EU outlined counter-tariffs on $117 billion worth of American products, including Boeing aircraft, automobiles and bourbon whiskey, signalling that trade tensions could escalate beyond Asia. European officials have indicated a willingness to accept 15% tariffs on most goods, while negotiating to keep rates on steel and aluminium at current levels, though these products may still face 50% duties. AI and monetary policy Adding to the complex global landscape, Trump signed executive orders launching his "AI Action Plan", aimed at maintaining American technological leadership through deregulation and energy infrastructure expansion. The plan emphasises federal standardisation over state-by-state regulation, while strengthening export controls to counter Chinese artificial intelligence development. On monetary policy, Trump's unprecedented visit on Thursday to the Federal Reserve -- the first presidential visit in nearly two decades -- highlighted ongoing tensions with chairman Jerome Powell over both interest rate policy and the central bank's building renovation costs. Despite public disagreements, Trump indicated he would not remove Powell over cost overruns, while continuing to pressure for rate cuts. Precarious position For Thailand, the stakes could not be higher. Without a successful trade negotiation with the US, the kingdom faces a punitive 36% tariff rate -- among the highest proposed -- creating a significant competitive disadvantage against regional peers. This cost differential of 10 to 16 percentage points compared with Vietnam (20%) and Malaysia (25%) could prompt foreign investors to relocate production bases. Finance Minister Pichai Chunhavajira's confidence in securing competitive rates reflects the urgency of Thailand's situation. The country may need to consider sacrificing protection for certain sectors to achieve an agreement that benefits the broader economy. Cambodian conflict Thailand's trade negotiations have been complicated by an unexpected military confrontation with Cambodia. Following a Cambodian artillery attack on Thai territory, Thailand responded by deploying F-16 fighter jets to strike Cambodian firing positions, leading to a temporary 0.58% decline in the SET index. While the immediate market impact appears limited -- Cambodia represents only 3% of Thailand's total exports -- the conflict could affect specific industries dependent on the Cambodian market, particularly energy products and consumer goods including beverages and fertilisers. For Cambodia, the economic consequences are far more severe, with potential losses including worker remittances worth 6.6% of GDP and shortages of essential goods including refined oil, fertilisers and food products. Market implications InnovestX analysis suggests limited impact on major Thai stocks, as most SET50/SET100 companies have minimal Cambodian exposure. However, stocks with significant Cambodian revenue face higher risks, including Samart Aviation Solutions (SAV) with 100% exposure, Carabao Group (CBG) at 14% and the consumer finance firm Aeon Thana Sinsap (AEONTS) with 7%. We maintain a cautious outlook, noting Thailand's structural disadvantage when it comes to trade requires urgent diplomatic resolution before the Aug 1 deadline. In the longer term, Thailand must diversify its trade relationships and accelerate free trade agreement negotiations with other regions to reduce dependence on the US market. Investment strategy In this environment of heightened volatility, investors are advised to maintain diversified portfolios across defensive stocks, government bonds, commodities including gold, and alternative assets. The Thai stock market is expected to consolidate while awaiting new catalysts and monitoring trade negotiation progress. As the Aug 1 deadline approaches, Thailand's ability to navigate both trade negotiations and regional security challenges will prove crucial for maintaining investor confidence and economic stability. The coming weeks will determine whether the kingdom can secure terms that preserve its competitive position in an increasingly fragmented global economy.
Bangkok Post
3 days ago
- Bangkok Post
PTT to sell stake in Taiwan pharmaceuticals firm
National oil and gas conglomerate PTT Plc has decided to adjust its investment in the life science business by selling a small portion of the shares it holds in Taiwan-based Lotus Pharmaceutical to boost financial flexibility. The proportion of the company shares listed on the Taiwan Stock Exchange to be sold will not exceed 2%. PTT owns a 37% stake in Lotus Pharmaceutical, said Pattaralada Sa-ngasang, chief financial officer of PTT. The completion date of the share sale has been set for July 2026. PTT holds shares in Lotus Pharmaceutical through its wholly-owned subsidiary Innobic (Asia), which operates life science-related businesses. "After this transaction in Lotus Pharmaceutical, Innobic will continue to be a major shareholder with a stake of no less than 36%," said Ms Pattaralada. "Innobic is still fully confident in Lotus Pharmaceutical's future growth." More financial flexibility after the share sale would allow PTT to drive future expansion in the life science sector, she said. The latest investment adjustment in Lotus Pharmaceutical is part of the company's revision of its life science business direction in alignment with evolving market conditions and the competitive landscape with the objective of enabling the pharmaceutical business to pursue self-funding growth, while also creating long-term benefits to PTT and Thailand. "We see a positive sentiment from special profit from the adjustment of the Lotus investment value before tax of roughly 6.2-7.6 billion baht which will be recorded in the third quarter," said Sornchai Pitthayaprug, a fundamental investment analyst on securities. "PTT will not lose control over the Lotus business and the support of profit of approximately 1.8 billion baht a year." Lotus Pharmaceutical, a listed manufacturer in Taiwan, is a distributor of medical drugs in South Korea and the US. Both Innobic and Lotus Pharmaceutical share a goal of developing the generic drug business in Southeast Asia to strengthen public health in the region. Lotus Pharmaceutical wants to focus on the treatment of non-communicable diseases (NCDs). Many countries in Asia have become ageing societies, leading to more demand for NCD medicines, Buranin Rattanasombat, chairman of Innobic (Asia), said earlier.
