Bangchak to invest in alternative fuels

Thailands Bangchak Petroleum Plc. (BCP), the majority state-owned oil refiner, is to invest 10 billion baht (US$292.3 million) to develop a fully integrated alternative fuels complex to diversify risks. The investment strategy is a result of the companys highest-ever gross refinery margin (GRM) of US$15 a barrel in the second quarter, up from US$12 in the first quarter and US$6.80 a year ago. Bangchak Senior Executive Vice-President Patiparn Sukorndhaman said the record margin came from inventory gains as crude prices climbed steeply almost every day. He said that Bangchak’s oil refinery utilization also jumped to a five-year high of 83,600 barrels per day (bpd), compared to an average output of 73,800 bpd last year. However, its retail oil business recorded its worst ever results, slumping from a profit of 0.25 baht (US$0.01) per liter in 2007 to a loss of 0.74 baht (US$0.02) per liter as Bangchak held back pump price increases in line with the policies of its parent company PTT Plc. (August 28, 2008)