Chief Executive Officer
2022 was the year of “Driving Organization amid Challenges” caused by COVID19-induced global economic slowdown, high inflation and persistent appreciation of US dollar, and tensions between Russia and Ukraine. Importantly, PTTEP had been facing a direct business challenge like the energy transition, where the global energy sector shifts its focus to more environmentally-friendly energy sources.
Text BoxAmid the aforementioned challenges, PTTEP had introduced new strategies in response to the current and future situations with emphasis on ensuring energy security, building readiness for the energy transition and adapting to future challenges through new businesses while safeguarding the environment through effective greenhouse gas (GHG) management. The strategies support the United Nations Sustainable Development Goals particularly 7, 8, 12, 13, 14 and 16, which are directly related to PTTEP activities, following PTTEP’s Sustainability Framework which focuses on striking a balance of the High Performance Organization (HPO); Governance, Risk Management and Compliance (GRC); and Sustainable Value Creation (SVC). The new PTTEP strategies include
1) Drive Value to strengthen E&P business, enhance competitiveness of the unit cost, and expand in natural gas and related business.
2) Decarbonize to achieve Net Zero GHG Emissions target by 2050 under EP Net Zero 2050 concept as announced at the Annual General Shareholders’ Meeting held on March 28, 2022, under avoid, mitigate, and offset concept. In this regard, we aim to expand our investment towards natural gas production, include GHG emissions criteria into our investment decision for new projects, and develop GHG emissions reduction technology through Carbon Capture and Storage (CCS) project while balancing the GHG emissions with land and mangrove reforestation as well as Blue Carbon projects to increase natural carbon sink.
3) Diversify by scaling up AI & Robotics Ventures Company Limited (ARV), a subsidiary of PTTEP and exploring opportunities in renewable energy, CCS as a service, Carbon Capture and Utilization (CCU), hydrogen, as well as other future energy.
Energy Security Reinforcement
Throughout 2022, PTTEP attained business achievements in line with our mission to provide energy security. In 2022, we were able to hit a historical production volume of more than 580,000 barrels of oil equivalent per day. Of total, natural gas accounted for 74% and the ratio is expected to keep rising. Highlights of 2022 achievements include successful operatorship transfer of the G1/61 and G2/61 Project in the Gulf of Thailand and Yadana Project in Myanmar, which was carried out smoothly and safely, enabling us to maintain gas production continuity. Besides, PTTEP put maximum effort to ramp up natural gas production in many projects such as Arthit, and the Malaysia-Thailand Joint Development Area (MTJDA) to reduce the impact of energy costs, which rose considerably in 2022. Moreover, in Malaysia, PTTEP successfully won the exploration bid for Block SB412 in Sabah, obtained a 10-year production period extension until 2039 for the Malaysia-Thailand Joint Development Area (MTJDA), and discovered natural gas at SK410B Project in Sarawak which would support PTTEP's long-term investment strategy. In the United Arab Emirates, PTTEP, in cooperation with Eni, as the operator, made a significant natural gas discovery from the first exploration well in Abu Dhabi Offshore Block 2 and acquired additional interest in Sharjah Onshore Area A following the strategy to strengthen growth in the Middle East. Meanwhile, the Algeria Hassi Bir Rekaiz Project in Algeria successfully commenced the first-phase oil production.
Safety at Heart
With strong determination and collaboration from employees from the operational to management levels, including contractors and related stakeholders to achieve “Zero Incident Organization” target, Safety, Security, Health and Environment (SSHE) management system is placed as the highest priority to ensure safe operations for employees and contractors and contribute no impact to society and the environment. This resulted in the improving trend of the Lost Time Injury Frequency (LTIF) and the Loss of Primary Containment Rate (LOPCR), which both are better than the latest average performance of the International Association of Oil & Gas Producers (IOGP). However, PTTEP commits to continuously enhancing our SSHE management system to ensure that our SSHE statistics are improved in all dimensions.
Collaboration for Sustainability
PTTEP believes that the power of collaboration can drive business, society and environment towards sustainability. Therefore, we have been working in collaboration with various alliances for sustainability. In 2022, PTTEP collaborated with multi-partners to build up technologies, particularly Carbon Capture and Storage (CCS) project in which we forged partnership with leading Japanese companies to explore the potential development of a CCS project in Thailand. We also partnered with companies within PTT Group to conduct a feasibility study on the CCS Hub Model, to reduce GHG emissions of the companies within PTT Group and nearby areas. Meanwhile, ARV, our subsidiary, signed a Memorandum of Understanding (MOU) with Aeronautical Radio of Thailand Limited to develop the Unmanned Aircraft System Traffic Management ARV also partnered up with Easy Rice, an innovative and digital technology in agriculture company, to improve Thai agricultural industry. In addition, ARV entered into a MOU with Dhipaya Insurance Public Company Limited to jointly develop a health platform which is an end-to-end health tech product connecting health insurance with healthy lifestyle.
Aside, PTTEP has collaborated with other partners in creating a sustainable value for wider society and the environment. For instance, we partnered with Department of Marine and Coastal Resources, Royal Thai Navy, Hydro-Informatics Institute (Public Organization), government agencies and leading universities in implementing various social development and environmental projects including ocean science data collection in offshore area of PTTEP operations under Ocean for Life strategy. In this regard, PTTEP established PTTEP Ocean Data Platform, a hub that collects, exchanges and connects PTTEP ocean database to the public so that the information can be used to better protect the ocean for the sustainability of marine ecosystems and coastal economy. PTTEP also joined hands with the Department of Fisheries, Kasetsart University's Faculty of Fisheries, Prince of Songkla University and Southeast Asian Fisheries Development Center (SEAFDEC) to study the development of fisheries habitats from wellhead jackets in the Gulf of Thailand. Additionally, the collaboration with Mae Fah Luang Foundation under Royal Patronage and ARV was initiated to collect data for forest carbon credit assessment as well as increasing carbon sink and biodiversity along with economic and social development through community engagement mechanisms and technology application. This supports Thailand’s goals in achieving Carbon Neutrality in 2050 and Net Zero GHG Emissions in 2065.
PTTEP strives to continually improve our sustainability management in alignment with our business context and stakeholders’ views and expectations for business sector’s responsible operations, ability to cope with emerging challenges and determination to support the Sustainable Development Goals of both Thailand and the United Nations. Those commitments led to PTTEP continuous performance improvement and resulted in various recognition awards in 2022 from both domestic and international institutes. It’s our pride to win Sustainability Awards of Honor at SET Awards 2022 thanks to receiving Best Sustainability Awards for 3 consecutive years; Outstanding Award in Low Carbon and Sustainable Business (LCSB) 2022 (the highest level) by Thailand Greenhouse Gas Management Organization (TGO); NACC Integrity Awards from the National Anti-Corruption Commission (NACC); Role Model Organization on Human Rights in State Enterprise sector from the Department of Rights and Liberties Protection for three consecutive years; and International CSR Excellence Awards by The Green Organization. PTTEP aims to continually benchmark the company’s sustainability performance through various key ESG raters such as FTSE4Good, Sustainalytics, MSCI, Vigeo Eiris or Moody’s ESG, S&P Global, and SET Awards with aim to refresh our sustainability strategies based on the evaluation results and keep the momentum of our proactive strategies.
In 2022, to reflect our commitment of becoming a low-carbon organization, PTTEP has a direction to publish our Sustainability Report and Annual Report (Form 56-1 One Report) in a digital format, without printing, to reduce GHG emissions while meeting new normal lifestyles.
I do believe that the world can be a better place with everyone’s support. My appreciation goes out to all management and employees for their One Team One Goal spirit as well as shareholders, business partners, suppliers, relevant government agencies, society and communities for their strong support in driving PTTEP under the foundation of the Sustainability Framework, allowing us to be able to deliver a better future to the next generation.
It’s in our hands to make the world a better place for everyone.