The National Energy Policy Council (NEPC) has approved a plan to buy an additional 1 million tonnes of liquefied natural gas (LNG) per year under a long-term purchase contract to relieve LNG price fluctuations, which affect national electricity generation costs.
The long-term LNG procurement means more stable prices than those sold in the spot market.
LNG prices in July under a long-term purchase contract stood at US$13-14 per million British thermal unit (BTU), while its prices in the spot market recently swung in a range of $43-44 per million BTU, said an Energy Ministry official who requested anonymity.
The NEPC granted permission to national oil and gas conglomerate PTT Plc, the sole importer of LNG under a long-term purchase contract.
In its statement released yesterday, the NEPC did not reveal what countries will supply the additional LNG.
The statement came as the Federation of Thai Industries asked the government to consider importing oil and gas from Russia, now facing sanctions from the US and its allies for its invasion of Ukraine.
PTT was earlier allowed to import 5.2 million tonnes of LNG per year under long-term purchase contracts. Another six LNG shippers received licences to import LNG in the spot market.
PTT operates a LNG receiving terminal with a storage capacity of 11.5 million tonnes a year in Map Ta Phut, Rayong. It co-invested with Electricity Generating Authority of Thailand to build the second terminal, with capacity of 7.5 million tonnes a year, in Nong Fab in the same province.
The new facility is scheduled to start operation soon.
Expensive LNG is blamed for increasing electricity bills, but Thailand needs to increase imports of LNG, following a drop of domestic gas supply in the Gulf of Thailand.
Gas makes up 60% of fuels used to generate electricity in the country.
In another development, the Energy Regulatory Commission yesterday said it expects to issue licences to community waste-to-energy (WTE) power plant operators under the second-phase WTE scheme within this month.
Authorities set a target to have 600 megawatts of electricity produced under the second phase.