Mr. Bandhit Thamprajamchit, Chief Executive Officer and President of Thai Oil Public Company Limited (SET: TOP or Thai Oil), stated that the company aims to complete the Clean Fuel Project (CFP) within 2Q28, which is earlier than the original plan scheduled for 3Q28.
Currently, the project has reached an overall progress of over 97%. After the company shifted its project management model in the past year from the EPC (Engineering, Procurement, Construction) contract to the EPCM (Engineering, Procurement, Construction Management) model, Thai Oil now manages work directly with various contractors to increase agility, control costs, and expedite construction for maximum efficiency
The company has also adjusted its work processes to better control quality, timeline, and investment budgets. The remaining construction under the new management is now approximately 8-9% complete, with a high possibility that the project will be finished ahead of schedule and save several billion baht in investment costs. Once completed, the CFP will increase Thai Oil’s total refining capacity to 400,000 barrels per day, enhancing its long-term competitiveness.
The CFP has been designed to accommodate heavy crude oil refining from various sources worldwide, such as Venezuela, Canada, or the Middle East. During the period when the U.S. eased sanctions against Venezuela, this helped increase the supply of heavy crude oil in the global market, making its price more attractive.
Regarding financial status, Thai Oil has successfully managed its capital structure, particularly through the Asset Monetization project in the form of Sale and Leaseback for infrastructure assets, such as Single Buoy Mooring (SBM), oil storage tanks, and certain port facilities. These measures allow the company to maintain operational control. The project was approved by shareholders with a 99.99% majority and provided the company with a net cash inflow of THB 18.23 billion.
Additionally, the company achieved significant success in issuing and offering subordinated perpetual bonds denominated in U.S. dollars worth USD 600 million. The funds raised support the company’s investments, especially in the CFP. This bond issuance was overwhelmingly received by global investors, with peak demand reaching over USD 6.5 billion, or nearly 11 times the offered amount, and final subscription at 10.33 times. This reflects investors’ confidence in the company’s credit strength.
By using financial instruments to manage risk, Thai Oil’s net interest costs when converted to Thai baht remain below the normal borrowing costs. The cash proceeds have been continually used to reduce the company’s debt burden, including the repayment of almost USD 1 billion of existing debt and an additional bond repurchase of USD 550 million, at an average discount of approximately 14%. As a result, from last year to the present, Thai Oil has reduced total debt by over USD 1.5 billion.
Mr. Bandhit further stated that in 2026, the average gross refining margin (GRM) is expected to remain at a good level due to the closure of old refineries in the U.S. and Europe, totaling 1 million barrels per day. Meanwhile, new refineries in China and India support increased demand for finished oil products in the market, resulting in this year’s average GRM at USD 5-6 per barrel.
However, Thai Oil has expanded into the aromatics and linear alkyl benzene (LAB) and lubricant businesses, resulting in an additional margin of USD 2 per barrel from its subsidiaries, giving Thai Oil a GRM of USD 7-8 per barrel. Furthermore, there will be no planned refinery maintenance shutdowns this year as opposed to last year. The company’s production utilization rate is targeted at 103%, up from 100% last year, with the return to operation of the SBM-2. As a result, Thai Oil’s operating results in 2026 are expected to improve.
On the topic of future business partnerships, Thai Oil is open to possibilities but will prioritize the principle of value creation. Any potential partner must help enhance the company’s value. If partners can strengthen the company’s capabilities and deliver good returns to shareholders, the company will carefully consider them.
