MOSCOW (MRC) -- Thailand's PTT Exploration and Production, or PTTEP, plans to bring home most of its equity crude barrels from its overseas upstream operations in 2022 rather than trading the oil, taking some pressure off domestic refinery feedstock procurement managers who constantly seek top-up barrels in the expensive spot market, reported S&P Global.
Major refiners across East Asia are scrambling to tie up as many term crude supply deals as possible for next year as they ramp up throughput levels and refinery run rates to serve rapid recovery in consumer and industrial fuel demand. The higher demand comes at a time when major OPEC producers are maintaining a cautious approach in raising crude supply, while prices extend uptrend.
In addition to term supply deals, Thailand is looking to make the most of its upstream investment portfolios, with PTTEP's subsidiaries PTTEP Oman E&P Corp. and PTTEP MENA set to provide state-run refiner PTT at least 5 million barrels of Oman crude for delivery over January-June 2022, PTT said in a statement.
Apart from the equity Oman barrels, PTTEP aims to supply domestic refineries its equity barrels from Algeria, Australia and the Americas, a marketing source at the state-run upstream company told S&P Global. The source declined to share information on the specific crude grades and volumes.
"PTTEP's equity barrels in Oman and other regions will allow local crude traders to take some breather as it's been rather troublesome and expensive to seek spot cargoes to cover short positions because of tight OPEC+ supply," a feedstock manager at PTT said.
PTTEP kicked off its Oman upstream operations in 2019 through the acquisition of Partex Corporation which later transformed into PTTEP Oman E&P Corporation and acquired two onshore producing petroleum blocks. The Petroleum Development Oman, or PDO, Block 6 project has a total oil production volume of around 610,000 b/d and Mukhaizna Block 53 project holds approximately 120,000 b/d. In February, PTTEP had acquired 20% in Block 61 through its subsidiary PTTEP MENA Limited which adds on condensate production volume around 65,000 b/d.
PTTEP's equity portion of the three projects equates to approximately 23,000 b/d of crude oil, according to PTT.
"The projects have allowed PTTEP further investment, create energy security, as well as generate revenue to the country," it said.
As MRC informed earlier, in October 2021, Thai chemical firm, PTT Global Chemical Pcl (PTTGC) said it plans to invest over USD22 bln in the next three decades to achieve net zero carbon emissions by 2050.
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.