Investor Relations

[Publish date : 27 February 2019]

Attachment:       

2. 2018 Annual Report and 2018 Sustainability Report
3. Duties and responsibilities of PTTEP Sub-Committees
4. Definition of Independent Director
5. Information on proposed candidates to be elected as PTTEP directors
6. Document and evidence required for meeting attendance and proxy granting
7. Invitation Letter (QR code Registration Form)
8. Proxy Forms A. , Form B. , Form C.
9. Name List and Details of PTTEP Independent Directors proposed to serve as Proxy for shareholders
10. Envelope for returning Proxy Form to PTTEP [Hard copy only]
11. PTTEP Articles of Association, the Public Limited Company Act B.E. 2535 and the Securities and Exchange Act B.E. 2535 concerning the Shareholders’ Meeting and Vote Casting
12. 2018 Annual Report and/or 2018 Sustainability Report Requisition Form
13. Map of the Meeting location
14. Procedures for Attending the 2019 Annual General Shareholders’ Meeting

PTT Exploration and Production Public Company Limited (PTTEP) would like to invite all shareholders to attend the 2019 Annual General Shareholders’ Meeting on Friday 29 March 2019 at 14.00 hours, at Bangkok Convention Center, 5th Floor, Central Plaza Ladprao (Plaza Zone), 1695 Phaholyothin Road, Chatuchak, Bangkok 10900. The meeting agendas are as follows:

Agenda Item 1       To acknowledge the 2018 Performance Results and 2019 Work Plan of the Company

Related Information :

The 2018 Company’s performance is as detailed in Attachment 1, whereas the 2019 work plan will be presented on the Meeting day.

The Board of Directors’ Opinion :

The meeting should acknowledge the 2018 performance results including the financial statements and other matters as illustrated in the 2018 Annual Report and the 2018 Sustainability Report. The meeting will also acknowledge the Company’s 2019 work plan which will be presented on the meeting day.

Agenda Item 2       To approve the financial statements for the year ended December 31, 2018

Related Information :

PTTEP’s financial statements for the year ended December 31, 2018 were audited by the Auditor, reviewed by the Audit Committee and endorsed by the Board of Directors. The details of the financial statements are in Attachment 1 and are summarized comparing with last year as follows:

The Board of Directors’ Opinion :

The Meeting should approve the financial statements for the year ended December 31, 2018 which have been audited by the Auditor and reviewed by the Audit Committee as proposed. The Board of Directors has also endorsed the financial statements.

Agend Item 3       To approve the dividend payment for 2018 performance

Related Information :

It is the policy of the Company that PTTEP, under normal circumstances, will pay dividend to shareholders of not less than 30 percent of net income after tax.  According to the Public Company Act B.E. 2535 Section 115 and the Company’s Articles of Association Clause 32, PTTEP’s Board of Directors may resolve to pay the interim dividend to shareholders in case the Company has adequate profits, and subsequently inform the shareholders at the next shareholders’ meeting.

For the year ended 2018, PTTEP reported total revenue of US Dollar 5,459 million; net profit of US Dollar 1,120 million; total assets of US Dollar 19,571 million; total liabilities of US Dollar 7,551 million; equity of US Dollar 12,020 million; unappropriated retained earnings of US Dollar 6,863 million and cash and cash-equivalents, including short-term investments of US Dollar 4,001 million.

The Company’s Board of Directors has considered that PTTEP should pay the dividend for the 2018 year of operations to the Company’s shareholders at 5.00 Baht per share, or approximately 55% of the net profit after tax according to the consolidated financial statements. The proposed dividend payment is consistent with the increase in the Company’s Net Income and should be acceptable to the investors given expected yields within the peer groups. The dividend payment also complies with the Company’s dividend policy, and has no impact to the Company’s liquidity and capital structure.

The Company has already made an interim dividend payment for the 2018 first-half-year operations on 24 August 2018 at the rate of 1.75 Baht per share from unappropriated retained earnings under the Revenue Code. The remaining 2018 dividend of 3.25 Baht per share will be paid from unappropriated retained earnings under the Petroleum Income Tax Act., and shall be payable on 11 April 2019, after obtaining approval from the 2019 AGM. The shareholders entitled to receive the dividend are per the shareholder list on the Record Date: 13 February 2019.

The dividend payment in Baht is made in reference to the company performance in US Dollars, and the weighted-average interbank exchange rate published by the Bank of Thailand 1 business day prior to the Board meeting date.

The dividend payment record for 2018 and 2017 are per the table below:

*Remark: Dividend Payout Ratio calculated based on the end of the year FX rates.

The Board of Directors’ Opinion :  

The meeting should acknowledge the interim dividend payment and approve the annual dividend payment for 2018 at 5.00 Baht per share. The company has already made an interim dividend payment for the 2018 first-half-year operations on 24 August 2018 at the rate of 1.75 Baht per share from unappropriated retained earnings under the Revenue Code. The remaining 2018 dividend of 3.25 Baht per share will be paid from unappropriated retained earnings under the Petroleum Income Tax Act, and shall be payable on 11 April 2019, after obtaining approval from the 2019 AGM. The shareholders entitled to receive the dividend are per the shareholder list on the Record Date: 13 February 2019.

Agenda Item 4      To appoint the auditor and consider the auditor’s fees for year 2019

Related Information :

The State Audit Office of the Kingdom of Thailand (the SAO) has been PTTEP’s auditor since the Company was established. The SAO does not have any relationship with, and is independent from the Company, its subsidiaries, managements, major shareholders, or their related parties. Even some of the Company’s subsidiaries are audited by other auditors, the Company’s Board of Director is responsible for ensuring that the financial statements of those subsidiaries are completed within the schedules.

The Audit Committee considers the SAO to be a reliable institution with a high performance record and an institution endowed with a sufficient number of qualified staff. The Audit Committee proposed that the SAO be appointed as the independent auditor of the Company for year 2019 with a fee of 2,800,000 Baht, an increase of 158,000 Baht from year 2018. (The fee for year 2018 was 2,642,000 Baht which was within the approved amount of 2,700,000 Baht from the 2018 Annual General Shareholders’ Meeting). The increasing rate is in line with audit scope due to the investment expansion of the Group and comparable with other listed companies.

In 2018, the Company did not pay non-audit service fee to the SAO. In 2017, the Company paid non-audit service fee for the preparation of Comfort Letters supporting the issuance of subordinated capital debentures to the SAO totaling 17,000,000 Baht.

Board of Directors’ Opinion :

The Meeting should approve the appointment of the State Audit Office of the Kingdom of Thailand to be the Auditor of PTTEP for the year 2019 with a fee of 2,800,000 Baht as proposed by the Audit Committee. This proposal has been subsequently endorsed by the Board of Directors.

Agenda Item 5       To approve the Board of Directors’ and the sub-committees’ remuneration

Related Information :

The 2018 Annual General Shareholders’ Meeting, held on 2 April 2018 has approved the board of directors’ and the sub-committees’ remuneration for 2018 to remain at the same rate as those in 2017 for every item. For this year, the Remuneration Committee has reviewed the remuneration package with the consideration of comments from the 2018 Annual General Shareholders’ Meeting that the rate for board of directors’ bonus shall be linked to the Company’s annual net profit and increased to be higher than 0.1% of annual net profit without ceiling, if there was an annual dividend payment to shareholders.

This is to create incentive for capable and experienced directors in assuming PTTEP directorship. The Remuneration Committee has taken into consideration the aforementioned comments from the shareholders along with the board of directors’ increasing roles and responsibilities, which cover not only current E&P business operations but also related and new businesses in consistent with corporate strategy in organization transformation as well as preparation for the considerably challenging operatorship transition in Bongkot and Erawan concessions. The Committee has also compared remuneration package for the board of directors and sub-committees with other leading listed companies (SET 50), companies within the E&P industry along with the trends among S&P 500 and companies under PTT Group, and has resolved the following comments:

1. The 2019 retainer fee for the Board of Directors shall remain at the same rate as in 2018 at 40,000 Baht/person/month and increase the meeting fee for the board of directors to be 50,000 Baht/person/meeting and sub-committee members to be 45,000 Baht/person/meeting (only when attending the meeting).
2. Bonus for the whole Board shall be increased from 0.1 percent of annual net profit to  0.2 percent of annual net profit as stated in the Company’s consolidated annual financial statements, with total limit of 60 million Baht as previously approved by the shareholders, if the Company pays dividend to shareholders and adjusted according to each director’s office period. This is to be effective from 2018 financial statements onwards until shareholders approve otherwise.

In the year 2018, the total remuneration for the board of directors as approved by the shareholders sums up to 59,194,974.20 Baht which includes bonus payment at the rate of 0.1 percent of net profit (35,054,974.20 Baht) and total remuneration for sub-committees at 7,120,000 Baht. The details of the remuneration for each director are presented in the 2018 Annual Report (Attachment 1). If the 2019 Annual General Shareholders’ meeting approve the bonus payment at the rate of 0.2 percent of net profit with ceiling remaining at 60 million Baht, the total remuneration for the board of directors would be 82,232,072.76 Baht which includes bonus payment of 58,092,072.76 Baht. Nonetheless, to avoid conflicts of interest, Directors who are shareholders and independent directors granted proxies by shareholders shall refrain from voting on this agenda unless the shareholders clearly define their votes in Proxy B or C.

The Board of Directors’ Opinion :

The meeting should approve the remuneration package of the Board of Directors and sub-committees as follow;

1. The retainer fee of the Board of Directors at the rate of 40,000 Baht/person/month and the meeting fee of 50,000 Baht/person/meeting for the Board of Directors, 45,000 Baht/person/meeting for Sub-committee members (only when attending the meeting). The Chairman of the Board should receive an extra 25 percent for both fees. The Chairman of Sub-committee should receive an extra 25 percent of meeting fee, effective from 2019 onwards until shareholders vote otherwise.
2. Bonus for the whole Board at 0.2 percent from the annual net profit as stated in the Company’s consolidated annual financial statements and the Chairman of the Board should receive an extra 25%, with the total limited to 60 million Baht if there was an annual dividend payment to shareholders, effective from 2018 financial statements onwards until shareholders vote otherwise.

Agenda Item 6       To approve the appointment of new directors in replacement of those who are due to retire by rotation

Related Information :

Pursuant to the Public Limited Company Act and Article 11 of the Company’s Articles of Association, one-third of the Board of Directors or five directors who assume the offices of director for longest period must retire by rotation at the Annual General Shareholders’ Meeting every year.  In 2019, 3 out of 5 directors who are due to retire by rotation are qualified as independent directors as prescribed in PTTEP Definition of Independent Director (Attachment 3).  The said definition is stricter than the rule set by the Capital Market Supervisory Board regarding the shareholding as details in item 1 of PTTEP Definition of Independent Director. The 5 directors who are due to retire by rotation are:

(1)  Mr. Achporn  Charuchinda  -  Independent Director, Chairman of the Audit Committee and Chairman of the Remuneration Committee

(2)  Mr. Sethaput  Suthiwart-Narueput  -  Independent Director, Chairman of the Risk Management Committee, Member of the Nominating Committee and Member of the  Audit Committee

(3)  Major General Nimit  Suwannarat  -  Independent Director, Member of the Risk Management Committee and Member of the Nominating Committee

(4)  Mr. Wirat  Uanarumit  -  Director and Member of the Risk Management Committee

(5)  Ms. Penchun  Jarikasem  -  Director and Member of the Risk Management Committee

The Company has invited all shareholders to nominate qualified person to be elected as PTTEP director through the Stock Exchange of Thailand channel and the Company’s website during 14 September – 17 December 2018.  However, there was no proposal of qualified nominee submitted to the Company.

The Nominating Committee has thoroughly considered, for maximum benefit of the company, the existing board composition and skill mix together with qualification, experience, expertise, term of directorship, the list of state enterprises directors of the State Enterprise Policy Office and proposal of PTT Public Co., Ltd. (PTT), major shareholder.   Also, PTTEP’s Board of Directors has thoroughly screened and deemed appropriate to propose 5 director nominees who are qualified to perform company’s business and for being PTTEP directors to the shareholders to elect in replacement of those who are due to retire by rotation in 2019, as follows;

(1)  Mr. Achporn  Charuchinda  -  Re-election for another term

(2)  Mr. Sethaput  Suthiwart-Narueput  -  Re-election for another term

(3)  Major General Nimit  Suwannarat  -  Re-election for another term

(4)  Mr. Wirat  Uanarumit  -  Re-election for another term

(5)  Ms. Penchun  Jarikasem  -  Re-election for another term

The Nominating Committee deems appropriate to re-elect the five director candidates for another term since they hold the knowledge especially in petroleum business which is a specific type of business.  They have great understanding in country’s energy strategy and in PTTEP's operations.  They successfully determined PTTEP strategic direction to push the company through the low oil price crisis and under the industry's volatile situation.  They played important roles to stipulate two winning strategies for acquiring Bongkot’s interests from Shell Company and for winning bids for Bongkot and Erawan petroleum concessions.  With these two accomplishments, the company’s production volume and reserves will be increased in the long term and the company can continuously maintain its production volume to promote Thailand’s energy security.  In addition, they support the organization re-structuring in order to make PTTEP to be ready for new business opportunities either related to oil and gas exploration and production or other new business. They also give priority to organization development to make sure the company is ready to cope with new technologies, structures and competitive working model.  Consideration to propose these five candidates for being PTTEP’s directors for another term would be beneficial and appropriate in terms of continuity in driving business strategy and organization transformation as intended in 2018.

(1)    Mr. Achporn Charuchinda be re-elected for another term because he possesses legal knowledge, expertise and extensive experience. He is keen on good corporate governance and the rules and regulations of the Securities and Exchange Commission (SEC) and the Stock Exchange of Thailand (SET). Thus, he has thorough understanding in the legal scope for listed companies as well as new law development. He can make the best use of his expertise to govern PTTEP which reflects from many of PTTEP’s good corporate governance awards to ensure company’s sustainable growth.   

(2)     Mr. Sethaput Suthiwart-Narueput be re-elected for another term because he possesses knowledge, capability and specialization in economics. He has various work experiences in banking and other businesses including government sector and leading private companies of both domestic and international.  With his business experience, he applies it to set strategic plan and to improve PTTEP’s efficiency especially during the low oil price crisis. His knowledge and expertise are beneficial for the company to have suitable organizational management, risk management and also new business opportunities which align with company’s strategic direction. 

(3)    Major General Nimit Suwannarat be re-elected for another term because he possesses knowledge, capability and clear understanding on government policies and security and safety strategic planning.  He has skill and extensive knowledge on information technology and information management which will be beneficial for PTTEP’s operations under disruptive technology environment. With his alertness for the disruption, PTTEP will be ready for the up-to-date working structure, human resources development, new technology implementation and data storage and information management.             

(4)     Mr. Wirat Uanarumit be re-elected for another term because he possesses knowledge, expertise and vast experience in financial and energy sectors. He has good understanding in energy business for the whole value chain.  Being as top executive in PTT, he has business vision in energy strategy and synergizes businesses of the companies in PTT group from upstream, midstream to downstream.  With his effort to promote the synergy among PTT group of companies, PTTEP can further its business to new investment in the related fields e.g. LNG and gas to power.   

(5)     Ms. Penchun Jarikasem be re-elected for another term because she has good knowledge, capability and expertise in accounting and finance. She has extensive experience working in the field of accounting and finance for many years. She currently holds the positions as Director of the State Enterprise and Director and the Chairman of the Audit Committee of Thailand’s leading companies. Also, she formerly held the positions as financial top executive of PTT and PTTEP, therefore she has deep knowledge and clear understanding on energy business and project investments.

Details of personal information and vision of the abovementioned director nominees are as in Attachment 4.

The Board of Directors’ Opinion :

The meeting should approve the election of 5 director nominees as screened and proposed by the Nominating Committee namely; (1) Mr. Achporn Charuchinda (2) Mr. Sethaput Suthiwart-Narueput (3) Major General Nimit Suwannarat (4) Mr. Wirat Uanarumit (5) Ms. Penchun Jarikasem. The Nominating Committee has duly reviewed this proposal which has been subsequently endorsed by the Board of Directors to further propose the list of director candidates to the State Enterprise Policy Committee for approval in accordance to the Regulations of the Office of the Prime Minister on State Enterprise Policy and Governance Determination and the State Enterprise Policy Committee has already approved the list of the 5 director nominees on 4 February 2019.  Among the 5 nominated directors, 3 directors (number 1, 2 and 3) are independent director according to his notification that his qualification is conformed to the PTTEP Definition of Independent Director.  Besides, the directors who are considered to have potential conflicts of interest in this election did not vote for the proposal at the Board of Directors’ Meetings.

In this regards, the Board of Directors has reviewed and considered that the proposed 3 nominated independent directors can freely give comments following to the related rules.

Agenda Item 7       Other matters (if any)

Related Information :

According to the Public Limited Company Act B.E.2535, shareholders who together have total shareholding of no less than one-third of the total number of shares sold may propose other matters to the Meeting for consideration other than the agenda items of the Meeting prescribed above.

The Board of Director's Opinion :

The meeting should not consider any other matters proposed at the meeting. This is to comply with the Principles of Good Corporate Governance for Listed Companies 2017 and the Annual General Shareholders Meeting Assessment Project that the Meeting should consider only the issues already informed in advance for fairness of the overall shareholders.

PTTEP has fixed the Record Date on which shareholders have the right to attend the 2018 Annual General Shareholders’ Meeting and to receive dividend on 13 February 2019.

All shareholders are cordially invited to attend the Meeting on the date, time and place aforementioned and the registration counters will be opened for shareholders’ registration from 10.30 hours onwards.  The Chairman has designated related officers who register the meeting attendants to collect the proxy forms on his behalf.  For greater convenience of all shareholders and proxy holders, it is recommended that all required documents and evidences as stated in Attachments 5, 6 or 7 (if any) be declared at the meeting’s registration.  Besides, shareholders may appoint PTTEP independent directors, whose list and details are in Attachment 8, as their proxy holders, and return the proxy forms together with supporting documents, Attachments 5, 6 and 7, to PTTEP by 22 March 2019 using the enclosed envelope (Attachment 9).

The Company recommends that shareholders use Proxy Form B (Attachment 7) so that they can specify the vote casting of each agenda item.  Shareholders can download Proxy Forms A and C from PTTEP website.  PTTEP reserves the right not to register shareholders in case where required documents and evidences are incomplete or inaccurate or do not meet the requirements and conditions specified.

PTTEP will conduct the Meeting in accordance with the Company’s Articles of Association and Public Limited Company Act concerning the Shareholders’ Meeting as detailed in the Attachment 10.

For any questions concerning the above agenda items or any matters relevant to the Company, PTTEP welcomes opportunity to clarify these matters in the meeting.  Please submit your questions in advance to CorporateSecretary@pttep.com or to the facsimile number 0-2537-4500.  PTTEP will provide snacks and beverages for shareholders and proxy holders who attend the meeting, but will not distribute any souvenir at this meeting.

PTTEP has sent the 2018 Annual Report and 2018 Sustainability Report (Attachment 1)
to all shareholders in CD-ROM format.  However, if any shareholders would like to have the hard copies of the 2018 reports, they may request them from the Corporate Secretary Office at the Energy Complex Building A, No. 555/1, Vibhavadi-Rangsit Road, Chatuchak, Bangkok 10900.  Shareholders may also fill in the Reports Requisition Form (Attachment 11) and return it to PTTEP.  For greater convenience and speed in receiving dividend, shareholders can request the Thailand Securities Depository Co., Ltd. (TSD)
to transfer their dividend to their bank accounts (E-dividend), which will then be incorporated into their next dividend payment.ขอแสดงความนับถือ

Yours sincerely,

Phongsthorn Thavisin

President and Chief Executive Officer

For more information, please contact Corporate Secretary Division, PTTEP :

• Pannalert Vasiksiri M.L.  Tel. 0-2537-4749 or
• Ms. Chatraphan Cheevanon  Tel. 0-2537-5310 or
• Ms. Nalinrach Suksathaporn 0-2537-4000 ext. 2233