Thailand June refinery operations 75%-80% of capacity - PTT Official

Domestic gasoline demand and strong gasoil margins have led Thai refiners to raise refinery runs for June, Surong Bulakul, senior vice president for international supply and trading at the Petroleum Authority of Thailand, or PTT, told Dow Jones Newswires.

Thai refiners are operating at about 75%-80% of the nation's 1.005 million barrel-a-day capacity.

Thai Oil Ltd. is operating at over 90%, up from about 85% in May, he said. PTT owns 49% of Thai Oil, which has a capacity of 220,000 barrels a day.

Joint venture Alliance Refining Co. is running at 95%-100%, he added. PTT officials earlier said the Alliance refineries, in Rayong, operated at 85%-90% in May.

Alliance Refining is a purchasing and operating joint venture between Rayong Refining Ltd. - a 145,000 b/d refinery owned by PTT and the Royal Dutch/Shell Group (RD) - and the 160,000 b/d Star Petroleum Refining Co., owned by Singapore's Caltex Corp. and PTT.

Bangchak Petroleum Pcl) operations are lower, at about 80% of its 120,000 b/d capacity, as the company lacks the secondary units to optimize middle and light distillate production, Surong said.

Thai Petrochemical Industry Pcl has limited runs of 65,000 b/d, as the company lacks funds to source more crude, officials with debt restructuring administrator Effective Planners said earlier.

TPI has a total 215,000 b/d capacity, but its smaller, 65,000 b/d crude distillation unit was mothballed last year.

Exxon Mobil Corp. doesn't release operating figures for its 145,000 b/d refinery in Sri Racha. However, PTT officials estimated its operations as "quite full," or about 85%.

Citing Thailand's excess capacity, Premier Thaksin Shinawatra earlier said his government was in discussions to refine crude for Indonesia.

However, the Indonesian side has yet to follow up with a detailed proposal for the type and amount of crude to be refined, Surong said.

PTT is offering to process some 10,000-20,000 b/d of crude for Indonesia in a three-step deal, Surong said.

According to PTT's proposal, Indonesian oil company Pertamina (P.PTM) would provide crude to Thai refineries, most likely through its term supply contracts in the Middle East.

PTT would refine that crude, but would actually provide Pertamina with products sourced through PTT's Singapore trading office, he said.

PTT is also mulling establishing an escrow account of some $50-$100 million with Indonesia to aid in oil trading between the two countries, Surong said.

If successful, the account could be expanded to some $1 billion to aid trading of agricultural commodities as well, he said.

Pertamina president Baihiki Hakim earlier told Dow Jones Newswires his company would agree to process crude in Thailand only if it were "economically feasible."

PTT officials are lukewarm on a plan to develop gas from the East Natuna Sea, also announced by Thaksin during Indonesian President Abdurrahman Wahid's visit to Bangkok.

Thailand is currently faced with an over-abundance of gas, and couldn't absorb gas from any additional sources until well after 2007, PTT officials said. (*)