Posted on June 20, 2015

Thailand's state-owned PTT could limit additional LNG purchases in the second-half of 2015 on lower gas consumption forecasts, a source with direct knowledge of the matter said Friday, June 19, said Platts.

"[PTT] expected gas consumption to increase by around 5% [in 2015] compared to last year, but [growth] is lower," the source said. "That is limiting [PTT's LNG] spot requirements." The change in consumption estimates is the result of an economy-driven slowdown in domestic power demand, and weaker exports due to slow GDP growth in China and other Asian economies. PTT has stepped out of the market for August, which coincides with the peak of Thailand's rainy season, and is still assessing its LNG requirements for September.

While gas consumption is expected to grow at a lower-than-forecast pace in 2015, LNG imports are likely to increase sharply year on year. In 2014, PTT imported a total of around 1.4 million mt of LNG, mostly from Qatargas through a sales and purchase agreement signed by the two parties in the form of a spot contract in 2011. This year, PTT expects to receive 2 million mt of LNG from Qatargas as part of a 20-year contract signed in 2012, and has so far secured a total of six cargoes through tenders, which account for more than 370,000 mt of LNG, based on a delivered cargo size assumption of 62,000-64,000 mt.

The first of these cargoes was sourced from Australia's North West Shelf and delivered aboard the Northwest Swan to PTT's Map Ta Phut terminal April 21. PTT bought this cargo from an unspecified seller in the $7/MMBtu range through a buy tender held late January to early February. The buyer also received a Nigeria-sourced cargo from France-based Engie, formerly known as GDF Suez, aboard the Gaselys on May 12. Engie was heard to have sold this cargo to PTT in the low $7s/MMBtu DES through a single-cargo buy tender awarded by PTT in the week ended February 27.

In addition, PTT received three cargoes in H2 May and H1 June that were awarded at around $7/MMBtu in a buy tender that closed April 6, with validity until April 8. Malaysia's Petronas delivered two of the cargoes from Bintulu, while Anglo Dutch Shell delivered a third cargo from Nigeria. Lastly, PTT is expecting the delivery of a single cargo in July 5-7 as part of a tender that closed April 18 and was awarded April 20. The tender was heard awarded to Qatargas in the $7/MMBtu range.