progress of investment projects - listed...

14

Progress of Investment ProjectsProgress of Investment Projects

15

PQI project

Investment Cost : USD 378 million

Product Quality Improvement (PQI) : Investing in “Hydrocracking Unit”and other supporting units

Capacity : 25 KBD Hydrocracking Unit

Progress : Resume runing

Fuel OilVDUVDU

HCUHCUHydroHydro--cracking Unitcracking Unit

Vacuum Distillation UnitVacuum Distillation Unit

HPUHPUHydrogen PlantHydrogen Plant

Vacuum Gas Oil

Mogas

Hydrogen

Diesel

9%

24% 17%

7%

Simplify Block flow diagram

Note : ∑∑∑∑ Mogas= 25% ∑∑∑∑ Diesel = 52%

LPG

Mogas

IK/Jet

Diesel

Fuel Oil33%

35%

11%

18%

3%

Existing Plant

PQI Plant

16

Co-generation plant & NG

Invested by : PTT (BOT : Build, Operate and Transfer to BCP after 25 Yrs)

Project : Co-generation Power Plant

Capacity • Electricity : 19.7 MW • Steam : 90 Ton/Hour

Progress : 94% (Jul’09)

Expected Completion : Oct’09

Investment Cost : Baht 108 million

Project : Natural Gas (NG)

Progress : Completion

17

Bio diesel (B100) plant

Investment Cost : Baht 1,018 million

Bio Diesel (B100) : Produce B100

Capacity : 300,000 litters per day

Progress :88.1% (Jul’09)

Construction Period : Apr08 - Oct09

18

Oil SituationOil Situation

19

Oil Price Movement

•Geopolitical Tension

• Speculation

•Geopolitical Tension

• Iran Nuclear Project

• Hurricane (Kathrina & Rita)

+ OPEC's supply reduction begin to stabilize price

+ Non-OPEC oil supply continuously decline

+ Geo-political risk can boost prices

+ Under investment is reducing supply

- High stock building

- Weak demand due to economic recession

20

World Oil Demand

• Oil demand continues to recover in Asia & ME.

• Global demand growth for 2010 is coming close to a consensus of 1.0 MBD.

MBD

MBD

Unit : %

2009 2010

@ Mar 2009

@ Jun2009

@ Mar 2009

@ Jun2009

World -1 .7 -2 .9 2 .3 2 .0

US -2 .4 -3 .0 2 .0 1 .8

Euro zone -2 .7 -4 .5 0 .9 0 .5

Japan -5 .3 -6 .8 1 .5 1 .0

OECD -3 .0 -4 .2 1 .5 1 .2

China 6 .5 7 .2 7 .5 7 .5

World Bank Global GDP Forecast

Stimulus package

Economic Indicator

21

World Oil Supply: OPEC

• OPEC spare capacity is around 7 MBD with4 MBD idles from Saudi Arabia.

• OPEC-11 compliance rate remains around70% of it’s 4.2 MBD pledged supply cut sinceSep’08.

• 18 Aug 09: OPEC president Angola said thegroup will not need to cut production furtherin 2009 if oil prices remain at current levels$70 to $75 per barrel.

• 19 Aug 09: Kuwaiti Oil Minister said that oilprices at current levels were "not bad" andhe saw no need for OPEC to cut in ViennaMeeting on September 9.

RHS

LHS

22

World Oil Supply: OPEC

OPEC Production vs. Quota

• Among OPEC's members, Saudi Arabiaaccounted for the biggest drop in production.

• The survey also found increased output fromIran, the second-largest OPEC producer, which ispumping above its target.

24.84 MBD

27.30 MBD

28.00 MBD

23

World Oil Supply: Non-OPEC

•Non-OPEC oil supply continuously decline in Europe from 2008-2010.

24

US inventories

• Overall inventories fundamentals are still weak.

• IEA August report, crude floating storage fell to 55 MB.

floating storage

25

USD/Euro vs. WTI and Speculators Effect

Speculators Effect (Speculators Effect (NymexN ymex Crude Futures & Options)Crude Futures & Options)

• Crude rebounded on optimism about economic recovery and weak US dollar.

• Return of hedges & investment in commodities are taken into oil prices

• CFTC’s bid to curb speculation in energy trading will make U.S. Future /OTC market less attractive.

• New regulations could be in place by late Oct. or Nov.

CFTC: The U.S. Commodity Futures Trading Commission

• Fed may keep low interest rate for a long period.

26

Seasonal Effect:

• Hurricane season will be less severe than last year but still have bullish impact.

• The National Oceanic and Atmospheric Administration (NOAA) projects 9 to 14 named storms will form within the Atlantic Basin over the next 6 months, including 4 to 7 hurricanes, of which 1 to 3 will be intense.

Geo-political risk:

• Nigeria supply disruption prolongs.• North Korea nuclear tension.• Iran unrest continues but not yet impact oil industry.

Other Factors

27Source : Analysis Team as of Jul. 28, 2009.

Oil Price Forecast Summary$/BBL

WTI is expected to average nearly73 $/BBL in 2010, as oil demandimproves.

ProjectedActual

Year

28

+ Distillate pick up with economy and increasing crude price+ Distillate demand improves during winter season+ Less supplies due to refinery run cuts

- Higher products output from new ref- Middle Distillate stocks increasing to record high - China’s ban of fishery season (Jun-Aug), slashing Gasoil demand- Vietnam import will decline after new ref. run full- H1N1Flu: WHO raised H1N1 to level 6 the spread is more serious worldwide slow jet demand from airline

Product crack spread

Kero/Dubai

29

+ Demand recovers with economic recovery.+ Less supplies due to refinery run cuts.

- Less Mogas end of driving season.- Higher products output from new ref.

+ Reduced FO supply from OPEC cuts.+ Tight supplies due to refinery run cuts.

- TEPCO will restart its 1,356 MW Nuclear power plant and will cut its fuel imports.- Lower demand for straight-run fuel oil in China due to high flat prices and as utilities switching to cheaper, cleaner LNG.

Product crack spread

30

Refinery GRM

+ Demand recovers with economy recovery.+ Less supplies due to refinery run cuts. + Distillate seasonal demand.+ Inventories continue to draw.

- Lower jet demand due to H1N1Flu.- Lower demand for FO due to TEPCO restart Nuclear power plant.

Focus in QFocus in Q44’’0909 Focus in Long termFocus in Long term

+ Demand recovers with economy recovery.+ Refinery project delay/ cancled.

- Refinery MEGA projects in ME to be complete in 2013.- Government policy support the investments into green energy and energy efficiency

31

BCP’s Updating in BCP’s Updating in 20092009

32

Stock performance and key indicatorsShare price (1 Jan - 24 Aug 2009)

*EBITDA excluded inventory effect for 12 months backward

BCP = +105.16%SET = +45.62%Energy +40.09%

FINANCIAL POSITION RATIO

Current Ratio times 1.72

AR Day days 15.85

DSCR* (net CAPEX) times 5.23

D/E Ratio times 0.72

Debt to EBITDA* times 1.74

Book Value per Share (BV) Baht 20.77

BV (excl. Revalued) Baht 16.60

(As at 30 Jun 09)

VALUATION FIGURES

Share Price (6 month-high) Baht 15.70

Share Price (6 month-low) Baht 7.05

Share Price (6 month-average) Baht 10.85

Share Price (Close) Baht 14.50

Net EV M.Baht 42,961

EV to EBITDA** times 4.65

P/E** times 3.71

P/BV times 0.68

(As at 30 Jun 09)

*Share price referred “BCP”**EBITDA & earning excluded inventory effect for 12 months backward

PROFIT RETURN RATIO

Net Profit Margin % 8.84

Earning per Share Baht 3.80

Return on Equity-ROE % 19.81

ROE (excl. Inventory & Revalued) % 20.05

Return on Assets-ROA % 9.01

ROA (excl. Inventory & Revalued) % 7.89

(For 1H09)

33

Bangchak well-equipped

• The LATEST Hydro-cracking technology from UOP, global acceptance in terms of proven production technology, provides better yield production from lower pressure operating condition.

• Competitive efficiency by equipping with Co-generation power plant and Natural gas (as Plant fuel), yet more environmental friendly.

• Capability of producing Diesel EURO IV captures government’s incentive, and even EURO V for fulfill niche markets.

• Ready for Gasoline EURO IV Top-up , comparatively small investment and time needed, allows early Incentive capturing.

• High flexibility configurations , 2 trains of crude distillation unit (CDU), enables to capture any opportunities via crude optimization or product segregation.

• Sitting in the heart of demand earns logistics edges and connects to several major distribution channels.

• Nationwide-established retail marketing network, especially COOP one , gives more reliability of maximizing the domestic sale.

• Capturing PTT Group synergy opportunities , such as 100% feedstock supply and 30% product off-take agreements from PTT and Oil Integrated Supply Chain Management.

• Wealthy financial status , ready to acquire any new opportunities

34

• Our Fuel oil (premium grade - very low sulfur), is still required in the market.

Another challenging year for refining business; however, BCP strongly believes, by all measures, we will be able to fight those threats.

• Considering an expansion of foreign limits

• Commit to increase shareholders’ value

Financial Readiness & Market Capitalization Enhancement, towards Future Prosperity

• Potential SET50 listed, more open to financial derivatives

• Capitalizing our Refinery’s Flexibility, that enhance capabilities of crude selection and optimization i.e. running parallel mode.

• Extensive and Intensive hedging activities

• Comply to IFRS standard

Operational Excellence on Flexibility and Differentiate Turns the Cloud to Sunshine

READY for future challenges!!