PTT's subsidiary has entered into an LNG procurement agreement with Oman LNG LLC. What strategic implications does this agreement hold for the subsidiary?

• Reported in September 2024: PTT International Trading signed a five-year agreement with Oman LNG to procure 3 million tons of LNG annually starting in 2025, concluding in 2029. • Agreement under negotiation: PTT is also negotiating a separate nine-year agreement with Oman LNG to procure 8 million tons of LNG annually starting in 2026 (not yet finalized). • Historical agreement: In 2023, PTT signed an agreement with Oman LNG to procure 8 million tons of LNG annually starting in 2026 for a nine-year term (potentially overlapping or superseding the above-negotiated agreement). These agreements reflect PTT’s sustained efforts in LNG procurement—particularly through its subsidiaries—to expand its international supply chain. Strategic Impact Analysis 1. Enhanced Energy Security and Supply Stability • Context: Thailand is Southeast Asia’s largest LNG importer, importing a record 11.7 million tons in 2023. Domestic gas field output—including the Erawan field in the Gulf of Thailand—has declined due to legal disputes and expiration of concession rights (e.g., Chevron’s concession ended in 2022), increasing Thailand’s reliance on imported LNG. The share of domestic natural gas in total supply dropped from ~50% during 2020–2023 to below 40% in 2023. • Impact: The long-term procurement agreements (five-year and potential nine-year) provide PTT’s subsidiary with a stable LNG supply source, reducing dependence on volatile spot-market purchases. Spot prices fluctuate significantly (e.g., Asian LNG spot prices surged to historic highs in 2022 due to surging European demand), whereas long-term contracts typically lock in costs via fixed or index-linked pricing (e.g., Henry Hub or Brent crude), helping stabilize electricity tariffs in Thailand. • Strategic significance: This reinforces PTT’s dominant position in Thailand’s energy market, ensuring reliable supply to critical sectors—power generation (58.5% of gas demand), industry (18.5%), and petrochemicals (18.7%)—while mitigating risks arising from Erawan field disruptions. 2. Strengthened Global Market Positioning and LNG Trading Capabilities • Context: PTT aims to manage an LNG portfolio of 9 million tons per year by 2030, positioning itself as a 'global LNG player'. Its subsidiary PTT International Trading handles international trade, while PTT LNG operates receiving terminals—including the Map Ta Phut terminal, whose vaporization capacity was expanded to 19 million tons per year in 2024. • Impact: The Oman LNG agreements diversify PTT subsidiary’s LNG procurement portfolio (Oman is a major, stable LNG exporter in the Middle East). The combined volume—3 million tons/year for five years plus up to 8 million tons/year for nine years (if finalized)—exceeds 9.3 million tons annually, substantially scaling up its global supply chain footprint. Moreover, PTT is negotiating deeper, longer-term collaboration with Oman LNG, potentially including equity investment or joint development. • Strategic significance: This not only consolidates PTT’s leadership in the Southeast Asian LNG market but also advances its ambition to become an LNG trading hub for ASEAN. Through these agreements, the subsidiary accumulates valuable international trading experience—laying groundwork for future negotiations with other major LNG suppliers such as Qatar and the United States.

Preview of the Thailand Petroleum Exhibition: Three Emerging Trends in the Southeast Asian Energy Market Revealed by Seven Major Under-Construction Projects

II. Trend Two: Concurrent 'Green Transition' and 'Capacity Upgrading' Under the global impetus toward carbon neutrality, Thai energy projects now exhibit simultaneous advancement in both 'environmental upgrading' and 'capacity expansion'—a trend especially evident across the current seven major projects. Green Transition Aspects • 1. Comprehensive enhancement of environmental standards: The Rayong refinery upgrade project explicitly stipulates compliance with stringent environmental requirements, expected to adopt advanced exhaust gas and wastewater treatment technologies to minimize environmental impact throughout refining operations. • • 2. Strengthened clean energy import capacity: The expansion of the Map Ta Phut LNG receiving terminal will significantly boost Thailand’s ability to import liquefied natural gas, laying the foundation for increasing the share of clean energy in the national energy mix. Capacity Upgrading Aspects • • 3. Continuous enhancement of refining and petrochemical capacity: Thai Oil’s Sriracha refinery pipeline expansion project will directly increase crude oil transportation capacity, thereby supporting higher overall refinery throughput to meet Thailand’s growing demand for refined petroleum products. • • 4. Optimized offshore oil & gas production efficiency: The Erawan & Bongkot offshore oil and gas field development project continuously improves natural gas production and transmission efficiency through ongoing construction and maintenance, ensuring stable domestic energy supply. III. Trend Three: High Market Concentration, with Industry Leaders Driving Development The contractors behind the seven major projects reveal a pronounced 'concentration at the top' in Thailand’s energy market: a small number of large enterprises control most key project resources—a structure that offers clear partnership pathways for exhibitors. Headline Enterprises’ Project Portfolio Table 1. 2. 1. PTT Group as the Absolute Leader: As Thailand’s largest energy enterprise, PTT Group and its subsidiaries (including PTT LNG and PTTEP) jointly lead four key projects, spanning natural gas, LPG, and LNG—making them the core force in energy infrastructure development. 3. 4. 2. Specialized enterprises with distinct focuses: Thai Oil concentrates on refining and petrochemicals, reinforcing its position in the finished oil market through pipeline expansions and refinery upgrades; IRPC/PTTGC focuses on the petrochemical value chain, delivering specialized raw material transportation services to industrial estates. IV. Action Recommendations for Exhibiting Companies: Targeted Engagement to Seize Three Key Opportunities Based on the latest trends in Thailand’s energy market, exhibiting companies are advised to pursue the following three strategic directions to maximize exhibition effectiveness: 1. 1. Focus on 'Connectivity' Needs: For sectors such as pipeline construction, subsea engineering, and regional transmission, showcase technologies and equipment characterized by high efficiency, reliability, and safety—e.g., large-diameter wear-resistant pipelines, subsea construction equipment, and intelligent monitoring systems. 2. 3. 2. Highlight 'Green Technology' Advantages: Address environmental upgrading needs by prioritizing the promotion of energy-saving and emission-reduction technologies, exhaust/wastewater treatment equipment, and clean energy utilization solutions—aligning precisely with Thai projects’ environmental requirements. 4. 5. 3. Prioritize Collaboration with 'Leading Enterprises': Conduct advance research into project progress and technical requirements of major players such as PTT Group and Thai Oil, and prepare customized cooperation proposals to achieve precise matchmaking at the exhibition.

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