Kiatnakin Phatra Securities (KKPS) noted in its report that Thai Oil Public Company Limited (SET: TOP) reported swift containment and cleanup following an oil spill incident at its Single Buoy Mooring No. 2 (SBM-2) facility on June 5, with operational disruptions expected to be short-lived.
This marks the second oil spill in the company’s history, with the prior incident in September 2023 involving a much larger release of 60,000 liters compared to the latest spill of 8,000 liters.
The incident occurred after winds reaching 60 knots—double SBM-2’s designed wind capability—forced a halt in loading operations, snapping a chain and triggering the breakaway coupling safeguard. The system’s rapid closure minimized the release, with 5,000 liters escaping outside the boom containment; the remaining 3,000 liters stayed within it.
Thai Oil confirmed on June 6 that cleanup operations were completed and no oil slicks remained visible.
KKPS stated that financial repercussions from the spill are expected to be minor due to the small volume and rapid remediation, as well as comprehensive insurance coverage. For comparison, a similar incident in 2023 led to THB 200 million in costs, most of which was recouped through insurance claims. There was no reported damage to SBM-2, and available spare parts suggest operations can resume within weeks.
The Marine Department has not yet mandated an investigation or shutdown, but Thai Oil noted it can temporarily use SBM-1 for offloading if needed, incurring a modest extra logistics cost of US$0.5 per barrel. Should a full shutdown nonetheless occur in the second quarter, the estimated earnings impact would be relatively small at THB 200 million, based on the analyst’s calculation.
Despite the minor disruption, KKPS views that Thai Oil’s valuation remains compelling, with a 2025 price-to-book ratio of 0.4x, below its typical trading range, and supportive market conditions for Singapore gross refining margins. The analyst maintains a ‘Buy’ recommendation for Thai Oil, with a target price set at THB 38.20 per share, and projects net profits of THB 13.86 billion in 2025, THB 15.46 billion in 2026, and THB 18.91 billion by 2027.
As per an analysis by Morgan Stanley, Thai Oil reported an 8,000-litre oil spill at its offshore SBM-2 on June 5, attributed to adverse weather conditions.
The spill comes as a setback for one of the country’s leading refiners, though the company says its refinery operations remain largely unaffected and expects to resume full operations within weeks by shifting logistics to ship-to-ship methods and its alternative SBM-1.
The company emphasized its comprehensive insurance coverage for such incidents. In the short term, operational expenses are projected to rise by $0.4 to $0.5 per barrel, reflecting the added logistics costs. A comparable incident in the third quarter of 2023 led to roughly $5 million in reported expenses for TOP.
Following these developments, the analyst rates Thai Oil at ‘Equalweight’ with a target price of THB 30 per share.
JPMorgan noted that the news regarding the oil spill triggered around a 5% drop in TOP shares on June 6 and partially reversed its gain of 9% over the past month.
The analyst views the sell-off as a short-term reaction unlikely to significantly affect operations or profitability and expects investor focus to soon return to positive refining margins anticipated for the second quarter of 2025.
Still, JPMorgan remains cautious on Thai Oil’s outlook and gives the company an ‘Underweight’ rating, with a target price of THB 23 per share. This follows expectations for a muted earnings trend into the second half of 2025, with softer gross refining margins and extensive maintenance planned for the third quarter.
In addition, persistent uncertainty around the Clean Fuel Project (CFP) timeline continues to weigh on sentiment.
