http://www.thaioil.co.th
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A LEADING FULLY INTEGRATED REFINING & PETROCHEMICAL VISION COMPANY IN ASIA PACIFIC • To be in top quartile on performance and return on investment • To create a high-performance organization that promotes MISSION teamwork, innovation and trust for sustainability • To emphasis good Corporate Governance and commit to Corporate Social Responsibility Excellent Striving Professionalism Vision Focus VALUE Ownership & Commitment Initiative Social Responsibility Integrity Teamwork & Collaboration 3
Corporate Governance Policy Roles and Responsibilities for Stakeholders • Truthfully report company’s situation and The board of directors, management future trends to all stakeholders equally and all staff shall commit to moral on a timely manner. principles, equitable treatment to all • Shall not exploit the confidential stakeholders and perform their duties information for the benefit of related for the company’s interest with parties or personal gains. dedication, integrity, and transparency. • Shall not disclose any confidential information to external parties. CG Channels Corporate Management Office +66-0-2299-0000 Thai Oil Public Company Limited ext. 7312-5 Should you discover any ethical 123 Suntowers Buidling B, 16F wrongdoing that is not Vibhavadi Rangsit Road, +66-0-2299-0024 compliance to CG policies or any Chomphon, Chatuchak, activity that could harm the Bangkok 10900 Company’s interest, please cg-coordinate@thaioil.co.th http://www.thaioil.co.th inform: 4
Q1/10 Highlights Performance Analysis Market Outlook 5
Q1/10 Highlights 6
Market Condition • GRM rebounded strongly as petroleum supply/demand balance improved – demand higher from broad economic recovery while supply tightened from low refinery runs. • Healthy BZ spread from solid demand while PX spread depressed due to slow demand during PTA turnarounds, Chinese New Year holidays, and higher feedstock cost • Robust lube base margins due to shortage supply in the region. Performance • Refinery utilization averaged 94%, as a result of a 15-day scheduled CCR-2 Heat Exchanger maintenance shutdown. • TPX’s P 2F lower due to weaken PX spreads & higher feed cost (platformate & cold MX import). • TLB has shown strong performance, whilst continued to introduce new product, 900SN lube base oil, to the market. • Integrated cash operating cost dropped from US$1.2/bbl to US$1.0/bbl, due to improved cost control thru OpX. • Sought opportunity in price risk management, ~100 MB from oil crack spread and ~50 MB from aromatics. Business Highlight • A 10-yrs THB 3,000 million bond was issued in April in response to reverse inquiry by local institutional investors. • In addition, approx. THB 8 billion of 5-yrs credit revolving facilities at attractive terms were entered with 4 major local banks, in preparation for the maturing USD 200 million revolver. • Entered into a 50% JV in Sapthip, a 200,000 L/D cassava based ethanol plant in Lopburi with a major cassava exporter. • TM purchased a new Alframax, a 96,000 DWT petroleum product tanker. 7
Performance Analysis 8
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials + Strong regional demand against GO LPG (controlled price) (Unit: $/bbl) (Unit: $/bbl) limited supply due to heavy spring refinery maintenance -16.4 -31.2 -33.7 -40.0 -47.5 -47.8 8.9 8.9 7.3 7.0 7.0 6.2 + Gasoline rebounded strongly HSFO ULG95 tracking western market -3.0 -3.0 -4.5 -4.7 -5.3 -5.8 12.6 + Limited FO supply 10.5 9.6 - Western inflow to Asia 8.9 8.5 5.1 + Jet fuel demand slowly pick up due JET to improved air traffic activities Market GRM 11.2 9.4 8.3 3.8 1.2 1.1 7.4 7.3 7.3 0.7 2.7 -1.4 Q1/09 Q2 Q3 Q4 Q1/10 FY/09 Q1/09 Q2 Q3 Q4 Q1/10 FY/09 9
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Crude Oil Price - Dubai + Better US/Global economic recoveries + Improved global oil demand (Unit: $/bbl) + OPEC keep crude quota unchanged 110 + Geopolitical in Iran and Nigeria + Earthquake in Chile causing2 major refineries’ 90 outages 76 70 62 - Stronger USD against EURO due to concern over 50 Greece’s debt - Fears of tightening monetary policy in China - Warmer-than-expected weather results in low 30 2009 Q1/10 heating oil demand 10
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Crude Oil Price - Dubai Stock Gain/Loss (Unit: $/bbl) (Unit: $/bbl) 110 76 75 68 90 3.5 59 70 0.4 44 -0.9 50 30 Q1/09 Q4/09 Q1/10 2009 Q1/10 Accounting GRM (Unit: $/bbl) 3.1 3.0 2.1 11 Q1/09 Q4/09 Q1/10
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Spread over Dubai Sources of Crude Spread over Dubai (US$/bbl) (US$/bbl) 2% * 3% * 4% 8% Far East -17.2 -10.7 LPG 9% 15% 14% Platformate Local 10% 5.1 16% 12.6 Gasoline 16% 7.3 9.4 Jet 19% 22% Middle East 87% 82% 6.2 37% 8.9 Diesel 35% -4.5 -3.0 FO 11% 10% * LPG Market Price – CP Aramco Q 4/09 Q4/09 Q 4/09 Q 1/10 Q1/10 Q 1/10 • Diversified into more exotic and cheaper crude. • Maximize GO production to capture domestic price premium and EURO 4 incentive 12
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Domestic Oil Demand / Refinery Intake Domestic Oil Demand +16% (KBD) (KBD) Q4/09 Q1/10 746 1,400 100% 89% 89% 88% 87% 87% 734 86% 1,200 80% 1,000 +5% 202 60% 138 800 215 221 192 131 -5% 600 335 319 40% +8% 400 -6% 155 734 746 722 711 699 690 20% 147 127 128 200 86 80 53 50 0 0% LPG Gasoline Jet/Kero Diesel FO Total Domestic Demand/Sales Net Export Demand Source: DOEB, Ministry of Energy. Others Utilization Rate TOP’s Domestic & Export Sales Refinery Intake 262 259 13% (KBD) 15% 21% Q1/2010 10% 48% Export Sales 1% Domestic Breakdown 85% 79% 13% Domestic Jobbers 11% 4% 13 Q4/09 Q1/10 Export = 15%
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Aromatics Spot Prices & Margins Utilization Q4/09 Q1/10 PX-ULG95 384 475 355 321 286 BZ-ULG95 -60 79 160 178 215 91% 84% (US$/Ton) 384 • PX margin squeezed due to 89 1,200 PX Surplus PX during PTA 1,000 BZ MX turnaround period & 800 Chinese New Year 600 ULG95 holidays 400 PX buyers were on the 200 Q4 Q1/10 Q1/09 Q2 Q3 sidelines waiting for *Revised aromatics price to Platts since Q2/09 further prices fall TPX’s Product Sales & P 2F (Kton/Quarter) Higher feedstock cost 39 46 TL 44 29 42 20 37 34 • Nippon Oil and CNOOC run 43 25 BZ 1 2 cut to 80% and 75% pushed 123 123 119 MX 105 105 BZ price and spread though PX over supply remained Q1/09 Q2 Q3 Q4 Q1 158 • Imported Cold MX to fulfill $/ton 157 155 159 154 120 PX utilization further $/bbl 20.6 20.3 21.0 20.2 15.7 pressured P2F 14 20.7
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Base Oil & Bitumen Spot Prices & Margins Utilization 398 264 404 429 435 500SN-HSFO Q4/09 Q1/10 70 -5 -3 -23 26 Bitumen-HSFO 98% 92% (US$/Ton) 374 10 1,600 • Higher Base Oil spread from 1,400 1,200 Bullish import by Indonesia 1,000 500SN 800 due to Pertamina plant’s 600 Bitumen furnace blast which caused 400 HSFO 200 at least 9 months closure 0 Q1/10 Q1/09 Q2 Q3 Q4 Seasonal peak for lubricant replacement TLB’s Product Sales & P 2F Base Oil plants T/A during (Kton/Quarter) Mar10 Bitumen 81 82 84 87 Lower FO prices widened 60 41 TDAE/Extract 36 39 36 23 /Slack Wax base oil spread 72 67 64 64 53 Base Oil • Robust Chinese and SEA Q1/09 Q2 Q3 Q4 Q1/10 demand for public projects 104 pushed Bitumen price and $/ton 97 99 96 126 115 margin higher $/bbl 14.8 15.1 14.5 19.0 17.4 15 15.8
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials 20.6 20.3 20.2 20.7 20.7 (US$/bbl) 15.7 Product to Feed Q1/09 Q2 Q3 Q4 Q1/10 FY/09 (US$/bbl) 3.8 2.7 1.2 1.1 Market 0.7 Crude GRM* -1.4 Q1/09 Q2 Q3 Q4 Q1/10 FY/09 19.0 (US$/bbl) 17.4 15.8 14.8 15.1 14.5 Product to Feed Q1/09 Q2 Q3 Q4 Q1/10 FY/09 * which excluded stock gain and loss Market GIM Accounting GIM (US$/bbl) (US$/bbl) 10.8 6.3 6.1 5.8 5.7 5.4 5.5 5.0 4.4 4.3 3.7 2.4 Q1/09 Q2 Q3 Q4 Q1/10 FY/09 Q1/09 Q2 Q3 Q4 Q1/10 FY/09 16
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