CLSA Securities stated that PTT Exploration and Production Public Company Limited (SET: PTTEP) reported a robust net profit of THB 27.2 billion (THB 6.85 earnings-per-share: EPS) for the second quarter of 2026, reflecting a 130% increase quarter-on-quarter and a 101% surge year-on-year. The strong performance was driven by record sales volume, higher average selling prices (ASP), and a substantial hedging gain.
The 4% QoQ increase in sales volume to 573,000 barrels of oil equivalent per day (kboepd) was primarily attributed to production ramp-ups at projects in the Gulf of Thailand. The oil price rose to $99.5 per barrel from $77.5 in the prior quarter, while the gas price edged up to $6 per MMBtu (Million British Thermal Units). Consequently, the ASP increased to $52.9 per barrels of oil equivalent (boe) versus $46.0 per boe in 1Q26. Unit costs also grew, reaching $29.8 per boe due to higher exploration expenses.
PTTEP also booked a $94 million hedging gain in the quarter, taking advantage of a lower forward curve. The reported net profit aligned with CLSA’s estimates and outperformed consensus by 3%.
Looking forward, PTTEP expects sales volume to soften to 525kboepd in 3Q26 due to maintenance shutdowns and lower oil loading in Algeria but anticipates an increase in gas prices to $6.2 per MMBtu from gas repricing in Myanmar and Malaysia. The company remains optimistic on oil prices staying above $80-90 per barrel amid ongoing Middle East tensions. Unit costs are expected to remain stable at around $30 per boe.
Hedging activity remains robust, with 19 million barrels hedged for the remainder of 2026 at a ceiling of $85 – 100 per barrel, which may result in hedging losses if oil prices exceed these levels.
CLSA maintains an “Outperform” rating and a THB 193 target price for PTTEP, highlighting attractive valuation and a projected 7.2% and 6.9% dividend yield for 2026 and 2027, respectively.
