thai oil public company limited q4 &...

-1-

Thai Oil Public Company Limited

Opportunity Day Presentation21 March 2018

Q4 & FY/2017

Time : 13:00 - 14:00 hrs.

Venue : Stock Exchange of Thailand, Building B, Room 603

-2--2-

Disclaimer

The information contained in this presentation is intended solely for your

personal reference. Please do not circulate this material. If you are not an

intended recipient, you must not read, disclose, copy, retain, distribute or take

any action in reliance upon it.

Some statements made in this material are forward-looking with relevant

assumptions, which are subject to uncertainties, which may cause the actual

result/performance to be materially deviated from any future

result/performance implied by such forward-looking statements. Please note

that the company and management/staff are not capable to control and

guarantee if these forward-looking statements will be accurately materialized,

they are subject to various risks and uncertainties.

-3--3-

VISIONA LEADING FULLY INTEGRATED REFINING & PETROCHEMICAL

COMPANY IN ASIA PACIFIC

MISSION

• To be in top quartile on performance and return on investment

• To create a high-performance organization that promotes

teamwork, innovation and trust for sustainability

• To emphasis good Corporate Governance and commit to Corporate

Social Responsibility

VALUES

Corporate Vision, Mission and Values

Professionalism

Ownership & Commitment

Social Responsibility Integrity Teamwork & CollaborationInitiative

Vision Focus

Excellent Striving

-4--4-

Corporate Governance

Corporate Governance PolicyThe board of directors, management and all staff shall

commit to moral principles, equitable treatment to all

stakeholders and perform their duties for the company’s interest

with dedication, integrity, and transparency.

Anti-Corruption PolicyThe Board, the management, and employees must not

corrupt or accept corruption of all forms in any circumstances,

covering the business of the Company in every country and in

every relevant agency. The Company defines guidelines,

operating measures, and roles and duties of responsible persons,

as well as regularly monitoring and reviewing the

implementation of the anti-corruption policy in compliance with

changes in businesses, rules, regulations, and relevant laws.

Roles and Responsibilities

for Stakeholders

• Truthfully report company’s

situation and future trends to all

stakeholders equally on a timely

manner.

• Shall not exploit the confidential

information for the benefit of

related parties or personal gains.

• Shall not disclose any confidential

information to external parties.

Whistle-Blowing Channels

Should you discover any

ethical wrongdoing that is

not compliance to CG

policies or any activity that

could harm the Company’s

interest, please inform:

Chairman of the Board or

Chairman of the CG Committee or

Chairman of the Audit Committee or

CEO/President or Company Secretary

Thai Oil Public Company Limited

555/1 Energy Complex Building A

11F, Vibhavadi Rangsit Road,

Chatuchak, Bangkok 10900

[email protected]

http://www.thaioilgroup.com

+66-0-2797-2999 ext. 7440-7442

+66-0-2797-2973

-5--5-

Our Achievement in Sustainable Development

5th Consecutive Year as the Member of DJSI Emerging Markets

5th Consecutive Year of leading positions:

Oil & Gas Refining & Marketing

-6--6-

Presentation Agenda

TOP GROUP BUSINESS OVERVIEW

2017 KEY FINANCIAL HIGHLIGHTS

2017 PERFORMANCE ANALYSIS

1H-18 MARKET OUTLOOK

-7--7-

TOP GROUP BUSINESS OVERVIEW

-8--8-

51% 25% 13% 11%

Thai Oil Group Business Structure

Net Profit Contribution

(Avg. from 2006 – 2017)

IRPC 20.0%

• 5 Oil & Chemical TankersCapacity : 52,350 DWT

• Crude Tankers: 3VLCCsCapacity: 881,050 DWT

• 14 crew & utility boats (120 DWT each)

• 2 Large vessels for crude, feedstock & product storage and transportation servicesCapacity: 200,000 DWT

• Ship management services

9.2 %

Principal power plant of PTTTotal Equity Capacity 1,922 MW of electricity 1,582 tons/hour of steam 2,080 Cu.m./hour of Industrial water 12,000 RT of Chilled water

PTT Group 80.0%

100.0% 100.0% 74.0% 100.0%

Thaioil (TOP)Thai Lube Base

(TLB)Thaioil Power

(TP)

Global Power Synergy Public Company Limited

Thaioil Energy Services(TES)

Thaioil Marine(TM)

Capacity : 275,000 barrels/day Small Power Producer

Program3-on-1 Combined CycleElectricity 118 MWSteam 216 tons/hour

PTT 26.0%

Proceeds the business on various professional of management services

100.0%

Thappline (THAP)

Multi-product PipelineCapacity:26,000 m.lts/y

20.0%

PTT 40.4%

Others 50.4%

Lube Base Oil Capacity :Base Oil 267,015 tons/annumBitumen350,000 tons/annumTDAE67,520 tons/annum

Thaioil SolventThrough TOP Solvent (TS)

100.0%

100.0%

Thaioil Ethanol(TET)

Solvent manufacturerCapacity : 141,000tons/annum

Thai Paraxylene(TPX)

100.0%80.5%

Solvent distribute in Thailand

Sak Chaisidhi (SAKC)

Top Solvent Vietnam

Solvent distribute in Vietnam

Sapthip (SAP)

Cassava Based EthanolCapacity : 200,000 lts/day

50.0%

Ubon Bio Ethanol (UBE)

21.3%

Cassava/Molasses Based PlantCapacity : 400,000 lts/day

PTT Energy Solutions(PTTES)

Provides engineering technique consulting services

20.0%

PTT 40.0%PTTGC 20.0%

BCP 21.3%

Others57.4%

Aromatics Capacity:Paraxylene 527,000 tons/annumMixed Xylene52,000 tons/annumBenzene 259,000 tons/annumTotal 838,000 tons/annum

LABIX Company Limited (LABIX)

LAB producer and distributorCapacity: 120 KTA COD: 2016

Mitsui 25.0%75.0% TOP SPP

2 Small Power Producers Total capacity: 239 MWSteam capacity 498 T/HCOD 2016

100.0%

Sells Electricity/Steam to Group

PTT Digital Solutions(PTT Digital)

PTT 22.6%

Thaioil & TP 29.7%

PTTGC 22.7%

Thaioil Treasury Center(TTC)

100.0%

Increases financial efficiency of Thaioil group

Supports execution of social enterprise of PTT group

15.0%PTT Group 85.0%

Sarn Palung Social Enterprise

-9--9-

Key Milestones: 56 Years, A Long Track Record of Success

2007• Increased refining capacity to 275 kbd

2008• The first refinery in Thailand with diesel

production to comply with the sulfur content requirements of Euro IV

• Capacity expansion of Thai Paraxylene with total aromatics capacity of 900,000 tons p.a.

• Invested in Solvents business in Thailand and Vietnam

1993• We expanded our refining capacity to 190 kbd

1994 – 1997• Increased total refining capacity to 220 kbd• Initial investment in Thai Paraxylene (“TPX”) and Thai

Lube Base (“TLB”)• IPT became the first IPP to enter into a PPA with EGAT2

with 700 MW capacity ; separately, Thaioil Power (“TP”) constructed the power generation plant under the SPP with 118 MW capacity

1961 – 1997 Capacity expansion and initial stage of

business diversification

2004 – 2011Listing, expansion and

diversification

TodayA leading integrated refining and

petrochemical group in Asia Pacific

• 275 kbd refinery ( approximately 22% of Thailand’s total refining capacity)

• Nelson index 9.81

• Diversified business through 16 subsidiaries

1961 – 1964

1961• Incorporated

1964• Commenced operation

with distillation capacity of 35 kbd

• Simple refinery with Nelson complexity Index ~ 41

1970• Refining capacity

expanded to 65 kbpd

1989• Increased refining

capacity to 90 kbpd

2004• IPO and listed on the SET • Acquired remaining shares in Thai

Paraxylene and Thai Lube Base which became our wholly-owned subsidiaries

2013-2014• Established LABIX• Invested in power biz via

GPSC & TOP SPP• Completed Emission

Improvement, HVU-2 Debottlenecking & CDU-3 Preheat Train project

2015-2016• Completed Projects: LABIX &

TOP SPP2017• 2017 Revenue 337,388 MB • 2017 Net profit 24,856 MB• Completed lorry expansion

project (10 to 15 mml/day)• Established Thaioil Treasury

center (TTC)

2010• Established Thaioil

Ethanol • Production expansion of

TDAE by 50,000 tons per annum

2011• Manufactured diesel

and ULG in compliance with the sulfur and BZ aromatics content requirements of the Euro IV

• Acquired 1st VLCC

Note 1. Based on our internal estimates using the methodology of the Nelson Complexity Index

2. The Electricity Generating Authority of Thailand (“EGAT”) is the national grid

-10--10-

TOP Group Synergy & Strategic Role in PTT Group Value Chain

NATURAL GAS

CRUDE IMPORT

Mixed-Xylene

Solvent

Toluene

Pentane

Hexane

SOLVENTS

TP & TOP SPP provides electricity and steam to Thai Oil group and sells its remaining power to the national grid

AROMATICS & LAB

Lube Base Oil

Bitumen

TDAE

Slack Wax

ExtractLUBE BASE

REFINERY LPG

Fuel Oil

Diesel

Gasoline

Jet/Kero

PLATFORMATE

LONG RESIDUE

REFINED PETROLEUM

POWER

Diversifying to a broad

range of downstream

products to enjoy higher

profit margins and

reduce earnings

volatility

Thai Oil’s Businesses

The majority of refined petroleum products are sold domestically to PTT

PTT is our principal domestic customer for our lube base products

Upstream Intermediate Downstream

Paraxylene

Benzene

Mixed-Xylene

Toluene

LAB

http://en.wikipedia.org/wiki/File:PTT_Public_Company_logo.svg






-11--11-

2017 KEY FINANCIAL HIGHLIGHTS

-12--12-

Stable Aromatics & LAB Margins(GIM contribution 1.6 $/bbl from 1.7 $/bbl in 2016)

Implication

Mkt GRM at 6.7 $/bbl(2016 = 5.2 $/bbl)

0.9 $/bbl inventory gain(from stock gain 1.6 $/BBL in 2016)

Refinery

Aromatics & LAB

Lube BaseImproved Lube Base Contribution(GIM contribution 0.8 $/bbl from 0.7 $/bbl in 2016)

Refinery + Aromatics & LAB + Lube Base

$/BBL 2017 2016

Market GIM 9.1 7.5

Inventory Gains / (Loss) 0.8 1.6

Accounting GIM 9.9 9.1

Robust refining margins supported by higher middle distillate spread due to improving regional demand, particularly China, and strong fuel oil spread backed by bunker demand.

Higher crude price driven by high compliance of OPEC & Non-OPEC to production cut, and strong global oil demand growth tracking robust global GDP.

Strong Base Oil spread supported by tightened supply from higher plant maintenance and unplanned shutdown in Asia.

Improved Bitumen spread following lower supply as some producers switch their production from bitumen to fuel oil.

Stable aromatics contribution as soften PX spread from new aromatics supply from startup of Reliance Phase II (PX 1.4 and BZ 0.4 MTA) in April was offset by improving BZ spread due to growing downstream demand and unplanned shutdown in U.S.

2) Based on refinery intake

2)

3)

3) Aromatic contribution including LAB

1)

4) Based on integrated intake

4)

1) Include Profitability Improvement

2017 Key Market Drivers HighlightsKey Highlights

-13--13-

67%15%

6%9%

3% Refinery

Aromatic & LAB

Lube Base

Power

Others

Key Achievements 2017 TOP Group Net Profit

Recorded high refinery annual utilization rate

Unit : million THB (MB) Net Operating ProfitReversal of NRV/(NRV) & Adjusted to cost

Sustainability& Awards

2017 2016

Refinery 112 % 108 %

Aromatic 83 % 81 %

Base Oil 88 % 81 %21,222 MB

Q4/17Q3/17

7,605 MB

FY2016

Capture high local & Indochina sales of petroleum products

2017 2016

Local 86 % 87 %

Indochina 9 % 9 %

Other exports 5 % 4 %

2017 2016

Operational Excellence

Growth &Profitability

Improvement

Profitability Improvement activities at 5,505** MB

** Compared with Corp. plan

71%

11%

7%10%

1%

Included Stock G/L

Best IR Award 2017 listed company with market cap > 100 Bn THB from SET

6,927 MB

2017 Key AchievementsKey Highlights

6.2633,330

21,438

15,288 2,259 3,341

3,343

6,138

(897)

865

754

39

(20)(609) (679) (243)

FY2017

24,856 MB

TOP SPP’s Project Finance 8,500 MB

Establishment of Thaioil Treasury Center (TTC) to enhance the efficiency of TOP group’s financial management

Stock gain/(loss)Others i.e. Hedging gain/(loss) & Non-recurring items

Sustainability Leader for Oil & Gas Industry for 5th consecutive years & 5th

consecutive years as Member of DJSI Emerging Markets

* MTA 1 month (Q3’16)

*

Successful COD Lorry Expansion Project (Mar’17) loading capacity from 10 to 15 mml/day

-14--14-Key Highlights

2017 Profitability Improvement (VS Corporate Plan)

FY 2017 FY 2016

THB 5,505 mn THB 3,629 mn

Unit: million THB

Margin Improvement (Supply & Marketing /

Hydrocarbon Management / )

Higher domestic/ CLMV petroleum sale

New crude processing

Energy improvement

Plant optimization

Cost Management

General & Admin , Procurement & warehouse , Operation & Maintenance , Project & Manpower management

LP Upgrading Model , Process Improvement

*

* Compared with Corp. plan

528

4,977

*

527

3,102

37%

13%

10%

12%

11% VLCC freight & demurrage saving

2%

http://www.google.co.th/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwjb-IPbjPTTAhVJTbwKHSJ0B2kQjRwIBw&url=http://economictimes.indiatimes.com/industry/energy/oil-gas/india-makes-first-crude-oil-purchase-for-strategic-reserve/articleshow/46748522.cms&psig=AFQjCNFvL1i0IIXU2NOCT76eb-ABCnkl7g&ust=1495013276781550

http://www.google.co.th/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwjb-IPbjPTTAhVJTbwKHSJ0B2kQjRwIBw&url=http://economictimes.indiatimes.com/industry/energy/oil-gas/india-makes-first-crude-oil-purchase-for-strategic-reserve/articleshow/46748522.cms&psig=AFQjCNFvL1i0IIXU2NOCT76eb-ABCnkl7g&ust=1495013276781550

-15--15-

2017 PERFORMANCE ANALYSIS

-16--16-Refining

Refinery: Recorded High Annual Utilization Rate

91%88% 89%

95%

89% 90%

98%98%94%

91%

94%

107% 109%107%110%111%

112% 114%112%

108% 108%112%

70%

90%

110%

Q1/16 Q2 Q3 Q4 Q1/17 Q2 Q3 Q4 2015 2016 2017

Industry utilization rate TOP utilization rate

TOP’s Domestic Sale vs Industry**Sales breakdown by customers

** Source: Department of Energy Business, Ministry of Energy

84% 83% 85% 81% 86% 84% 87% 86%

16% 17% 15% 19% 14% 16% 13% 14%

Q4/17

TOP IndustryThailand

Q3/17

ExportQ3/17 Q4/17 FY/17 FY/16

TOP Ind. TOP Ind. TOP Ind. TOP Ind.

CLMV 11% 7% 9% 6% 9% 6% 9% 5%

Others 5% 10% 6% 13% 5% 10% 4% 9%

Domestic

Export

FY/16

36%

11% 8%1%

30%

10%4%

DomesticJobbers

FY/17

Sales

Breakdown

Export 14%

36%

11% 8%1%

29%

10%5%

DomesticJobbers

Q4/17

Sales

Breakdown

Export 15%

TOP/ Domestic Refinery Utilization Rate

Unit: % Utilization Rate

Domestic Oil Demand

* exclude Fuel Oil & LPG demand



FY/17


*

0

200

400

600

800

Mogas Jet/Kero Diesel Total Demand

2016 2017

2.9%

3.7%

3.4%

KBD

4.4%

-17--17-

Gross Refinery Margins - GRM

27 2935

3944 46 42 44 43

4944

52 54 54 51 52 5146 48 50 54 56

61 62

20

40

60

80

Ja

n

Fe

b

Ma

r

Ap

r

Ma

y

Ju

n

Ju

l

Au

g

Se

p

Oct

No

v

De

c

Ja

n

Fe

b

Ma

r

Ap

r

Ma

y

Ju

n

Ju

l

Au

g

Se

p

Oct

No

v

De

c

2016 2017

Refining

2016 2017 2016

$/bbl Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY17 FY16

DUBAI (DB) 30.4 43.2 43.2 48.3 53.1 49.8 50.5 59.3 53.2 41.3

ULG95 - DB 18.8 14.4 11.6 14.6 14.8 14.2 16.1 14.4 14.9 14.9

JET - DB 11.7 11.1 11.1 12.3 11.3 10.8 13.2 13.3 12.1 11.6

GO - DB 9.6 10.5 11.0 12.0 11.8 11.4 13.9 13.0 12.5 10.8

HSFO - DB (5.2) (8.7) (4.3) (1.7) (3.1) (1.8) (1.3) (3.1) (2.3) (5.0)

2016 2017 2016

$/bbl Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY17 FY16

Market GRM 6.1 4.4 4.3 6.0 6.5 6.1 8.1 6.0 6.7 5.2

Stock G/(L) (1.0) 4.2 (0.6) 3.5 (0.2) (2.2) 2.4 3.6 0.9 1.6

AccountingGRM

5.1 8.6 3.7 9.5 6.3 3.9 10.5 9.6 7.6 6.8

- Lower product spread mainly from increased supply after resumption from unplanned shutdown in Q3

Dubai Crude Price & Key Petroleum Product Spreads Refinery Utilization

Q3/17 Q4/17 2017 2016

114% 112% 112% 108%

Dubai Price

(US$/bbl)

Q4/17 Market GRM

Q4/17 Performance

*Murban OSP over Dubai ($/bbl)

% MB Intake/OSP*

41%/1.5

40%/2.9

42%/1.7

46%/ 2.7

+ High Run rate at 112% to capture strong domestic and Indochina market

2016 DB avg. 41.3 $/bbl

2017 DB avg. 53.2 $/bbl

Q1TD’18 (16 Mar 18) ULG95-DB = 13.7 $/bblJET-DB = 16.2 $/bblGO-DB = 14.6 $/bblHSFO-DB = (4.7) S/bbl

Q4/17: Soften Mkt GRM pressured by Increased Supply after Resumption from Unplanned Shutdown in U.S. and Higher Crude Premium

2017 FY

+ Higher DB price due to OPEC and Non OPEC production cut

+ Stronger Mkt GRM as higher product spread especially middle distillates and fuel oil

- Higher crude premium due to lower light crude supply after OPEC production cut

-18--18-

Aromatic’s Sales (excluding by product) & Product-To-Feed Margin (P2F)

290

360 347 339

292 314

377 345

303 266

296 278

292 323

322

268 268 282 274 255 246 254 256 270

121

167 180 177

130 108

193 187

143 100

191 264

347

412

279 233 205

238 201 193 193 186 206

246

-30

120

270

420

570

2016 2017 2016

$/ton Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY17 FY16

PX**-ULG95 332 315 341 280 312 273 258 260 276 317

BZ**-ULG95 156 138 174 185 346 226 195 213 245 163

2016 2017 2016

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY17 FY16

Aromatic P2F -$/ton 98 99 109 95 126 91 84 93 99 100

Aromatic P2F -$/bbl 12.8 13.0 14.3 12.4 16.4 11.9 11.0 12.2 12.9 13.1

GIM contribution*** 1.4 1.7 1.9 1.6 2.1 1.5 1.4 1.5 1.6 1.7

Remark: TOL –ULG95 Q3/17 = 62 $/ton, Q4/17 = 54 $/ton, FY/17 = 77 $/ton

Aromatics Spreads and Margins Aromatics Production

Q3/17 Q4/17 2017 2016

81% 82% 83% 81%

(Unit : KTon)

Q4/17 Market

*** including LAB contribution since 25 Feb 2016** PX price = CFP Taiwan, BZ price = FOB Korea

Q4/17 Performance176

435

57

447

176

72

104 113 108 110 122 103 108 113

43 44 35 54 4545 43 43

20 17 11 825

17 16 13TL

BZ

PX

+ Optimized Aromatics run (Aromatics V.S. gasoline margins)

(US$/Ton) PX-ULG95

BZ-ULG95

2016 2017

Q1TD’18 (16 Mar 18) PX-ULG95 = 310 $/tonBZ-ULG95 = 240 $/ton

Aromatics/LAB

Q4/17: Improved Contribution supported by strong downstream demand

2017 FY

Stable Aromatics contribution following growing downstream demand but offset by additional supply, particularly from India

+ Improved PX spread from strong downstream i.e. polyester, PTA demand, as well as improved BZ spread from lower supply due to technical issues in U.S. plants and strong downstream product i.e. SM demand

-19--19-

TLB’s Sales (excluding byproduct) & Product-To-Feed Margin (P2F)

453 426 403 388 399441 453 448 428

384 378 338 370445

539 538 558 571 560 529 495 471 441 461

38 (20) (39) (34)

(49)(60) (51) (62) (70) (74) (65) (103)(32) (11) 4 (41) (44) (30) (29) (20) (38) (33) (55) (46)

-200

0

200

400

600

800

Lube Base Oil

2016 2017 2016

$/ton Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY17 FY16

500SN-HSFO 427 409 443 367 451 556 528 458 528 412

BITUMEN-HSFO (7) (48) (61) (80) (13) (38) (29) (45) (29) (49)

2016 2017 2016

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY17 FY16

P2F -$/ton 126 121 106 77 116 118 113 102 112 107

P2F -$/bbl 19.2 18.4 16.1 11.7 17.6 17.9 17.1 15.5 17.0 16.2

GIM contribution

0.9 0.9 0.6 0.5 0.9 0.9 0.8 0.7 0.8 0.7

63 57 41 54 60 58 60 5737 35 28 40 47 45 43 36

97 9781

113 110 109 101 104

Base Oil & Bitumen Spreads & Margins Base oil Production

Q3/17 Q4/17 2017 2016

88% 88% 88% 81%

500SN-HSFO

Bitumen-HSFO

(Unit : KTon)

Q4/17 Performance

Bitumen

Specialty

Base Oil

22% 21% 21% 22%

16% 13% 14% 14%

Q3/17 Q4/17 FY/17 FY/16

Base Oil Specialty

% Base Oil & Specialty Sales Volume

215

141

388

Q4/17 Market

235

154

424

(US$/Ton)

2016 2017

Q1TD’18 (16 Mar 18) 500SN-HSFO = 514 $/tonBIT-HSFO = (54) $/ton

− Soften lube spread due to increased lube supply after resumption from maintenance

Q4/17: Slightly Lower Contribution Pressured by Lower Demand and Increased Lube Supply after Resumption from Maintenance

2017 FY

+ Higher P2F due to tightened supply

+ Stable utilization rate at 88%

− Lower bitumen spread as weak regional demand especially China and Indonesia

-20--20-Power

Q4/17 Power Sector Performance…Growing Contribution to the Group

628 614 643 6192,055 2,504

Q1/17 Q2/17 Q3/17 Q4/17 FY/16 FY/17

Equity holding inGPSC ****

SPP

711 707 739 674

2,388 2,832

Q1/17 Q2/17 Q3/17 Q4/17 FY/16 FY/17

407 382 416 365

1,305 1,570179 202 216 174

656771

586 584 632 539

1,961

2,341

Q1/17 Q2/17 Q3/17 Q4/17 FY/16 FY/17

(3) consolidated EBITDA of TP and TOP SPP

(4) Net profit of 74% TP + 100 % TOP SPP + 24.29% profit sharing from GPSC

+ Robust contribution from TOP SPP full year run and increasing equity income and dividend from GPSC19%

Power Business Sector

Power & Steam Sales

EBITDA & Net Profit

Electricity(1)

(GWh)

Steam(1)

(kton)1,054 1,073 1,076 1,030

3,686

4,233

Q1/17 Q2/17 Q3/17 Q4/17 FY/16 FY/17

EBITDA(THB million)

Net Profit(THB million)

***TOP shareholding 24.29% (8.91% via TOP and 20.79% via TP)GPSC is an associate company of TOP. Equity method is applied to recognize share of profit. (EBITDA calculation excludes profit sharing from GPSC)

SPP (TP+TOP SPP)Equity income from GPSC

(1) 100% of TP and TOP SPP

(2) (2) TOP SPP COD 1st block in Apr 16 and 2nd

block in Jun 16

Performance Highlight(3)

(4)

-21--21-

Integrated Margin & Competitive Cash CostFinancial

5.7

7.8

5.26.7

6.0

1.2

5.96.8 7.6

9.6

2014 2015 2016 2017 Q4/17

1.5 1.3 1.4 1.3 1.9

0.80.6 0.5 0.4

0.3

2.31.9 1.9 1.7

2.2

2014 2015 2016 2017 Q4/17

Operating Cost Interest Expense

(Unit: US$/bbl)

Group’s Cash Cost

(Unit: US$/bbl)

Market GIM Accounting GIM (Market GIM + Stock G/L)

Market GRM Accounting GRM (Market GRM + Stock G/L)

Gross Integrated Margin

(Unit: US$/bbl)

*

*Including MTA cost in MTA period since mid Jun-late July 2014 for 46 days (TOP MTA cost in 2014 = 436 MB or 0.14 $/bbl)

(excl. one-time non-operating item)

(net)

5.4

1.1

7.6

5.8 5.2

6.7 6.6 7.5 6.0

9.5 0.1

0.1

0.6

0.6 1.7

1.7 1.6 1.6 1.5

1.5

0.7

0.7

0.9

0.9 0.7

0.7 0.8 0.8

0.7

0.7

6.2

9.17.5

9.1 8.3

1.9

7.2 9.1

9.9

11.8

2014 2015 2016 2017 Q4/17

Refinery Aromatics+LAB Lube Base

1.8 1.5 1.8 1.6 2.40.7 0.6 0.5 0.5

0.42.6

2.1 2.3 2.12.8

2014 2015 2016 2017 Q4/17

Operating Cost Interest Expense

(Unit: US$/bbl)

*Including MTA cost in MTA period since mid Jun-late July 2014 for 46 days ( TOP group MTA cost in 2014 = 609 MB or 0.20 $/bbl)

(excl. one-time non-operating item)

(net)

Higher group cash cost in 2016 mainly from MTA cost in TLB ~198 MB or ~ 0.1 $/bbl

*

Gross Refining Margin Refinery’s Cash Cost

-22--22-Performance Breakdown

2017: Performance Breakdown by Business Unit

(1) U-rate of 5 Oil & Chemical Tankers (total capacity: 52,350 DWT)(2) U-rate of TET Q1/17 includes MCE 1-month U-rate at 124%, SAPTHIP 102% and UBE 100% , Q2/17 includes SAPTHIP 93% and UBE 83%, Q3/17 includes SAPTHIP 99% and UBE 107%,

Q4/17 includes SAPTHIP 111% and UBE 103%, and FY/17 includes MCE 1-month U-rate at 124%, SAPTHIP 101% and UBE 98% (3) Includes 75% of LAB net profit Q1/17 = 118 MB, Q2/17 = (1) MB, Q3/17 = 12 MB, Q4/17 = (9) MB and FY/17 = 120 MB (4) Apply on an equity accounted basis in the consolidated financial statement. (GPSC has been held by TOP 8.9% and TP 20.8%,TP has been held by TOP 74% & TOP SPP has been held by TOP 100%)

Q1/17 4,492 1,213 489 148 1 120 586 7,075 734 6,341

Q2/17 1,316 555 523 25 15 40 584 3,250 (2,205) 5,455

Q3/17 5,940 473 435 52 (8) 51 632 7,605 1,362 6,243

Q4/17 5,866 490 365 84 (538) 52 539 6,927 4,206 2,721

2017 17,614 2,730 1,812 309 (530) 263 2,341 24,856 4,097 20,759

112%

83% 88%

123%

96% 99%108%

81% 81%

109%

92% 90%

2017

2016

Refinery Aromatic Lube Solvents Marine Ethanol Power

Consol

Utilization/Production (%) & Net Profit (million THB)

Stock G/(L) & Reversal of NRV/(NRV) & Adjusted to cost

Consol ExclStock G/(L)& Reversal of NRV/(NRV) & Adjusted to cost

Key Points• Refinery: higher utilization to capture decent

margin and strong demand (local + Indochina)

• Aromatic/LAB: despite stable margins, net profit contribution declined due to end of loss-carry forward tax benefit

• Lube: higher contribution from improved lube and bitumen spread due to supply tightness

• Power: higher contribution from TOP SPP & GPSC

• Solvents: higher utilization but lower net profit as higher competition depressed margins

• Marine: declined contribution due to slow down in E&P business and loss from asset impairment

• Ethanol: higher utilization and contributionsupported by higher ethanol price whereas lower cost

(1) (2)

(3)(4)

(3)

(3)

(4)

(4)

(3)

(3)

(4)

(4)

-23--23-

THB/US$ - average 33.11 33.54 (0.43)

THB/US$ - ending 32.85 33.53 (0.68)

Effective Tax Rate (%) 20% 18% 2%

35.57 (2.46)

36.00 (3.15)

12% 7%

34.10 35.46 (1.36)

32.85 36.00 (3.15)

18% 10% 8%

Financial

2017 TOP Group Consolidated P&L

2017 2016 YoY+/(-)Q4/16 YoY+/(-)(million THB) Q4/17 Q3/17 QoQ+/(-)

Stock G/(L)&Reversal of NRV/(NRV) & Adjusted product stock to cost

4,206 1,362 2,844

Net Profit/ (Loss) excl. Stock G/(L) and Reversal of NRV/(NRV) & Adjusted product stock to cost

2,721 6,243 (3,522)

Sales Revenue 89,443 80,296 9,147

Hedging Gain / (Loss) (63) (20) (43)

EBITDA 10,810 10,983 (173)

EBITDA excl. Stock G/(L) & Reversal of NRV/(NRV) & Adjusted product stock to cost

6,604 9,621 1,832

Financial Charges (797) (812) 15

FX G/(L) & CCS 677 705 (28)

(Tax Expense)/reversal of income tax (1,711) (1,729) 18

Net Profit / (Loss) 6,927 7,605 (678)

EPS (THB/Share) 3.40 3.73 (0.33)

3,042 1,164

2,760 (39)

77,104 12,339

(330) 267

10,085 725

7,043 (439)

(911) 114

(870) 1,547

(794) (917)

5,802 1,125

2.84 0.56

A Mainly from overall sale volume and product price increased

B Mainly from loss in inventory hedge

C Mainly from higher Mkt GIM 9.1 $/bblfrom 7.5 $/bbl

D Realized gain on AP/AR & unrealized gain on USD debt from THB appreciated in 2017

4,097 6,177 (2,080)

20,759 15,045 5,714

337,388 274,739 62,649 A)

(133) (243) 110 B)

36,925 32,675 4,250 C)

32,828 26,498 6,330

(3,285) (3,461) 176

3,182 446 2,736 D)

(5,529) (2,295) (3,234)

24,856 21,222 3,634

12.18 10.40 1.78

YoY analysis

-24--24-

2017 TOP Group Consolidated Cash FlowFinancial

FY/17 FY/16

Operating Cash Flow 34,417 23,182

Net income & non-cash adj. 38,568 32,832

Change in working capital (4,151) (9,650)

Beginning

cash 31,121

S/T investment 29,654

Available for sale 244

61,019

+

+ =

+

Ending

15,623

52,318

3,103

71,045 5)

Effect of FCD

(596)+Change

(14,901)

22,664 4)

2,859

Operating Cash Flow

Financing

(Unit: Million THB)

(Unit: Million THB)

Free Cash Flow 4,325 4,830

FY/17 FY/16

Investments (30,092) (18,352)

ST investments (23,423) (12,057)

Available for sale (2,865) (28)

CAPEX (PP&E) & other (3,804) 1)

(6,267)

Financing (19,226) (9,397)

Loans proceeding 3,681 2)

4,091

Loans repayment (10,088) 3)

(3,051)

Interest (3,364) (3,443)

Dividend (9,455) (6,994)

Investments

1)TOP 3,257MB, SAPTHIP 121MB, SAKC 61MB

2) LABIX 3,145MB, SAPTHIP 400MB3) TOP 4,932MB,

LABIX 4,063MB, SAKC 240MBSAPTHIP 516MB, TM 166 MB

4) non-cash transaction : adj. FX gain from fixed deposit 499MB

AP as at 31Dec’16 233MB, other 27MB5) FCD = 16,120MB (497MUSD)

-25--25-Financial

2017 TOP Group Strong Financial Position & Financial Ratios

102,000 102,561 101,897

54,956 47,527 58,270

60,775 57,963

67,941

111,597 115,837 127,148

75,434 67,643 65,499

30,700 24,572 35,461

0.2 0.1 n/a

31-Dec-15 31-Dec-16 31-Dec-17

1) Including current portion of Long-Term Debt

Financial Ratios

Net Debt / adj. EBITDA** Net Debt / Equity

Statements of Financial Position

(Unit: million THB)

Trade Payable/ Others

LT Debt

Equities

CurrentAssets

Non-CurrentAssets

Cash & ST investment

217,731

31 Dec 16 30 Jun 17

** Annualized EBITDA (excl stock gain/loss & Reversal of NRV/(NRV))

ROE 20.3% 16.8% 20.8 %

ROIC 18.8% 15.8% 20.2 %

*

* Based on actual performance in the past 12 months

*

208,051

1)

BBBStable Outlook

Baa1Stable Outlook

AA- (tha)Stable Outlook

0.7 0.6

31-Dec-15 31-Dec-16 31-Dec-17

n/a

2)

2) Including available for sale 31 Dec 16 = 244 MB, 30 Jun 17 = 2,941 MB,31 Dec 17 = 2,859 MB

Consolidated Long-Term Debt as at 31 Dec 17

65,499 million THB

(US$ 1,994 million

equivalence)

Total Long-Term Debt Net Cash228,108

31 Dec 17

1,474 million THB

(US$ 45 million

equivalence)

Cost of Debt

TOP Group (Net) 3.46%

TOP Group (Gross) 4.79%

Interest Rate Portion

Float 10%

Fixed 90%

TOP avg.debt life 10.8 Yrs

Value (Million) Portion

US$ Bond & US$ Loan USD 1,094 55%

THB Bond THB 23,500 36%

THB Loan THB 6,080 9%

As at 31 Dec 17 (32.85 THB/US$)

*** ***

*** Net cash 1,474 MB or 45 M$

-26--26-

7.82

9.19

8.13

9.40

0.11

5.91

4.39

7.28

6.04

4.57

-2.03

5.97

10.40

12.18

FY/04 FY/05 FY/06 FY/07 FY/08 FY/09 FY/10 FY/11 FY/12 FY/13 FY/14 FY/15 FY/16 FY/17

Annual DPS (Baht/share)

1.80 3.50 3.50 4.50 2.75 2.55 2.00 3.30 2.70 2.30 1.16 2.70 4.50 5.25

Dividend Payout 25% 40% 45% 48% n.a. 43% 45% 45% 45% 50% n.a. 45% 43% 43%

Dividend Yield* 4.0% 5.6% 5.6% 6.2% 5.2% 7.1% 4.0% 4.7% 4.2% 3.6% 2.3% 5.0% 6.7% 6.2%

Avg TOP price 44.7 63.0 62.7 72.7 53.3 35.9 49.9 69.8 65.1 64.6 50.4 53.5 66.7 84.2

Dividend Policy : Not less than 25% of consolidated net profit after deducting reserves, subject to cash flow and investment plan

Unit : THB/Share EPSR

1H dividend

* Based on average TOP share price in each year

2H dividend

Year Dividend

2017 Dividend Payment

R Based on restated financial statement (year 2013 – 2014)

**

** Dividend payout before restated = 45%

***

Financial

1.50 1.75 1.75

1.05 0.601.30

0.50 0.80 0.56 0.901.50 1.50

2.00 2.75

1.00 1.50

1.40

2.00

2.20 1.50

0.60

1.80

3.00 3.75

1.80

3.50

*** To be approved by AGM on April 11, 2018

-27--27-

1H-18 MARKET OUTLOOK

• Crude Oil

• Petroleum Products

• Aromatics

• Base Oil & Bitumen

• Linear Alkyl Benzene (LAB)

-28--28-

CRUDE OIL

-29--29-

0

20

40

60

80

Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Apr-18

$/BBL

Dubai Price Movement

BREXIT

Canada wildfire & Nigerian outages

Keystone & Forties pipeline outage

10 consecutive weeks decline of U.S. Crude

Stocks

Crude Oil

Sustaining Crude Prices with Downward Trend amid Surging U.S. Supply

Key Highlights in 1H-18*Q1TD’18 (as of 16 Mar ): $ 63.4/BBL

1st OPEC-led supply cut deal extension

Hurricane

Harvey & IrmaPolitical crisis

in Iraq

• Oil Market Turning to Surplus in 1H-18 Pressured by Massive U.S.

• Oil Production

• Supply Cut Deal to be a Double-edged Sword for OPEC

1

2

Output cuts extended to end of 2018

OPEC-Led cut deal achieved

OPEC and Non-OPEC agreed to cut 1.8 MBD oil output

Robust demand and lower U.S. output from winter storm

-30--30-

Surging Non-OPEC Supply Led by U.S. Production

1 Oil Market Turning to Surplus in 1H-18 Pressured by Massive U.S. Oil Production

Crude Oil

Sources: EIA (Feb’18), IEA (Jan’18)

Rising U.S. Production to Above 10 MBDA

C Supply to Outpace Demand in 1H-18D

U.S. Crude Oil Production

-1.5

-0.5

0.5

1.5

2.5

7.0

8.0

9.0

10.0

11.0

Jan-16 Jan-17 Jan-18

Production [LHS]

MBD MBD

Sources: IEA (Jan’18) and TOP’s Estimate

YoY Growth [RHS]

-1.0

0.0

1.0

2.0

3.0

Q3'17 Q4'17 Q1'18 Q2'18

Africa Asia EU N.America

LatAm FSU Others Net Growth

Non-OPEC Supply Growth (YoY) MBD

Source: IEA (Jan’18)

Higher Price Heightens Shale Oil ProductionB

MBD, YoY

-0.4

0.0

0.4

0.8

1.2

$40 $45 $50 $55 $60

2018 Annual Shale Oil Growth vs. WTI Price

Sources: Bank of America (Oct’17)

World Oil Supply in 1H-18 vs. 2H-17

94

95

96

97

98

99

2H-17Supply

U.S. Other Non-OPEC

OPEC-12 1H-18Supply

1H-18Demand

98.3498.410.160.75 0.08

97.91

Unit : MBD

-31--31-

OECD Oil Stocks Approaching 5-yr Average

2 Supply Cut Deal to be a Double-edged Sword for OPEC

Winter Storm Generates Unexpected Demand

C

Crude Oil

Sources: OPEC (Jan’18) and IEA (Jan’18)

High Compliance from both ProducersA

B 2,500

2,600

2,700

2,800

2,900

3,000

3,100

3,200

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

5yr-range 2017 2017F (Nov'17) 5-yr Average

0

20

40

60

80

100

120

140

160

Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17

OPEC Cut Non-OPEC Cut

Global Demand Growth by Region (YoY)

Compliance Rates of Output Cut%

MBD

OECD Oil Inventories MBBL

1.211.27

0.97

-0.5

0.0

0.5

1.0

1.5

N.Am LatAm ME Africa Asia EU Total

Q4-17 Q1-18 Q2-18

Sooner market rebalancing than previously

anticipated

OPEC and its allies will review the market

condition on 22 June’18

Target Level

Sources: IEA (Jan’18) and TOP’s Estimate*

Source: IEA (Jan’18)

-32--32-

PETROLEUM PRODUCTS

-33--33-

8.57.9

6.1

8.0 7.6 7.7

5.0 5.2

6.76.2 6.5 6.4

8.27.2 7.1 7.1

Q1-15 Q2-15 Q3-15 Q4-15 Y2015 Q1-16 Q2-16 Q3-16 Q4-16 Y2016 Q1-17 Q2-17 Q3-17 Q4-17 Y2017 Q1TD-18*

Key Highlights in 1H-18

Singapore Cracking GRM ($/BBL)

Firm Gasoline Margin Due to Healthy Demand Despite Higher Chinese Exports

1

Steady Middle Distillate Cracks from Robust Demand and Limited Saudi Arabian Supply

Firm Petroleum Product Market from Robust Demand Growth and Limited Supply

($/BBL) 2016 Q1-17 Q2-17 Q3-17 Q4-17 2017Q1TD-

18*

ULG95-DB

14.8 14.7 14.2 16.1 14.4 14.9 13.7

JET-DB 11.6 11.3 10.8 13.1 13.3 12.1 16.2

GO-DB 10.8 11.8 11.3 13.8 13.0 12.5 14.6

HSFO-DB

(5.0) (3.2) (1.8) (1.4) (3.0) (2.3) (4.7)

2

Refinery

Remarks: *Q1TD-18 as of 16 Mar 18

Lower-than-expected Supply Addition from the Delay Start-up of Nghi Son and Jeddah’s Closure

3

-34--34-

Steady U.S. Demand Despite Higher Crude PriceBTighter Market on Firm Demand & Refinery MTA A

1

Refinery

MBDAsia Pacific Gasoline Demand

MBD

KBD

Source : FGE Energy (Jan’18)Source : FGE Energy (Jan’18)

Firm Gasoline Margin Due to Healthy Demand Despite Higher Chinese Exports

6.4

6.6

6.8

7.0

7.2

7.4

Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Apr-18

1H-18: 7.1 MBD (+0.23 MBD YoY)

Asia Pacific Gasoline Balance

Source : JBC (Jan’18)

MBD U.S. Gasoline Demand

-0.2

0.0

0.2

0.4

0.6


Improved demand & tight supply during MTA

High China’s Exports on Refinery Start-up in Q4’17

1H-18: 9.2 MBD (+0 MBD YoY)

Source : EIA (Feb’18)

Chinese Gasoline Export

0

100

200

300

400

Jan-16 Jul-16 Jan-17 Jul-17 Jan-18

1H-18 : 260.9 KBD (+33.2 KBD YoY)

AVG 2016: 225 KBDAVG 2017: 246 KBD

C

8.2

8.6

9.0

9.4

9.8

10.2


-35--35-

Lower Surplus in H1-18 During Refinery MTA Period BRising Asia Demand from Recovered Economy

Steady Middle Distillate Cracks from Robust Demand and Limited Saudi Arabian Supply2

Refinery

A

High China’s Exports on Refinery Start-up in Q4’17D

Asia Pacific Gasoil Demand

Sources : JODI (Jan’18), Reuters (Jan’18)

Lower Saudi Arabian Exports Due to MaintenanceC

KBD

0

200

400

600

800

Jul-16 Jan-17 Jul-17 Jan-18

Q1’18 : Satorp (400 KBD) & Samref (400 KBD) MTA

Q4’16 :Yasref (400 KBD) & Ras Tanura (550 KBD) MTA

Saudi Arabia’s Net Gasoil Export

Sources : Reuters (Jan’18), EIA (Feb’18)

KBD

Source : FGE Energy (Jan’18)

Chinese Gasoil Export

0

100

200

300

400

500

600

Jan-16 Jul-16 Jan-17 Jul-17 Jan-18

1H-18 : 349.1 KBD (+20.7 KBD YoY)

MBD

Source : FGE Energy (Jan’18)

Asia Pacific Gasoil Balance

0.0

0.5

1.0

1.5

2.0


AVG 2016: 313 KBD AVG 2017: 352 KBD

MBD

8.0

8.5

9.0

9.5

10.0

10.5


1H-18: 9.3 MBD (+0.21 MBD YoY)

-36--36-Refinery

Note: Adjusted capacity based on start-up period (effective additional capacity)

Asia Pacific and Middle East Effective CDU Addition VS Additional Demand

Sources: FACTs Semi Annual Reports, Fall 2017, Reuters (Nov’17) , IEA Medium Term Outlook (Mar’17) and TOP’s estimate

3Lower-than-expected Supply Addition from the Start-up Delay in Nghi Son and Jeddah’s Closure

3150

517

1386 1431

875

454562

5

474 565

1207

897 880

493311

-64

-500

500

1500

2500

3500

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

KBD

Middle East China Other AP Japan India Vietnam Teapot Net Addition AP & ME Demand Growth

Demand growth > New Capacity Addition

-37--37-

Year on YearAverage

2015-2016(B) Y2016(B) Y2017(B) Y2018F(C)

Mogas (A) +11.5% +9.8% +3.7% +3.1%

Jet/Kero +8.2% +6.8% +4.4% +2.5%

Diesel (A) +3.5% +3.1% +2.9% +1.9%

Total +6.3% +5.4% +3.4% +2.3%

GDP +3.1% +3.2% +3.9%(D) +3.9%(E)

Domestic

Remarks: (A) Mogas and Diesel includes Ethanol and Biodiesel, respectively

(B) DOEB Statistics

(C) PTT’s Estimation (Jul-17)

(D) BOT’s Estimate as of Jan-18

(E) BOT’s Estimate (BOT Monetary Report as of Dec-17)

Thailand Oil Demand Growth

Thailand Oil Demand Growth

Thailand oil demand growth at 2.3% YoY in 2018

-38--38-

AROMATICS

-39--39-

($/TON) 2016 Q1-17 Q2-17 Q3-17 Q4-17 2017 Q1TD-18*

PX-

ULG95317 313 273 258 260 276 310

BZ-

ULG95163 343 225 195 212 245 240


Aromatics Market

Firm PX Market supported by Summer Demand and New PTA Plants

Stable BZ Market on Firm Chinese Import Interest amid Slightly Lower Demand Growth

1

2

255246233

288256

332315341

280317 313

273258260276310

Q1

-15

Q2

-15

Q3

-15

Q4

-15

Y2

01

5

Q1

-16

Q2

-16

Q3

-16

Q4

-16

Y2

01

6

Q1

-17

Q2

-17

Q3

-17

Q4

-17

Y2

01

7

Q1

TD

-18

*

PX CFR Taiwan-ULG95 ($/TON)

98 11574

101 97

156138174185

163

343

225195212

245 240

Q1

-15

Q2

-15

Q3

-15

Q4

-15

Y2

01

5

Q1

-16

Q2

-16

Q3

-16

Q4

-16

Y2

01

6

Q1

-17

Q2

-17

Q3

-17

Q4

-17

Y2

01

7

Q1

TD

-18

*

BZ FOB Korea-ULG95 ($/TON)

PX and BZ Market Still Supported by Firm Market Fundamentals


Aromatics

-40--40-

0.71.2

0.9 0.9

1.8 1.81.20.7

1.7 1.41.9

3.185%

88%

50%

60%

70%

80%

90%

100%

0

1

2

3

4

1H-17 2H-17 1H-18 2H-18 2017 2018

PX Capacity Addition PX Demand Growth Operating Rate (RHS)

Mil TON Operating Rate

11.8 12.614.2

15.5

0

5

10

15

20

2015 2016 2017 2018

AromaticsFirm PX Market supported by Summer Demand and New PTA Plants

High PTA Plants to Support PX Consumption in 2018Firm Polyester Demand to Support MarketA B

C

Source: PCI WoodMac (Nov’17), TOP’s Estimate

AP/ME Effective PX Capacity vs Demand Addition

1

1.2

4.5

0.6 0.7

2.6

1.9

0.0

1.0

2.0

3.0

4.0

5.0

1H-17 2H-17 1H-18 2H-18 2017 2018

Effective Capacity from Previous Year Effective Capacity

Mil TON PTA

Nghi Son (0.8Mil TON)

PetroRabigh (1.34Mil TON) Tongkun 2 (2.5Mil TON)

JBF (1.2Mil TON)

Chinese PX Import Volume Remains in UptrendD

90% 94%

10% 6%

0%

20%

40%

60%

80%

100%

2017 2018

Chinese PX Consumption by Source

AP/ME Effective PTA Capacity Addition

Dropping Recyclate* to Support PX Consumption in China

26.227.9

0

5

10

15

20

25

30

2017 2018

Mil TON

*Recyclate: PX from Recycle material such as PET and fiber

Mil TON

-41--41-Aromatics

Slightly Higher SM Capacity Addition in 2018Slightly Lower BZ Addition in 2018 to Support Market A B

China Continued to be a Biggest BZ Importer, Replacing U.S.

C D

Source: IHS (Jan’18), TOP’s Estimate

Stable BZ Market on Firm Chinese Import Interest amid Slightly Lower Demand Growth2

0.64 0.69

0.4

0.20.3

0.4

0.0

0.2

0.4

0.6

0.8

1.0

1H-17 2H-17 1H-18 2H-18 2017 2018

Effective Capacity from Previous Year 2018 Effective Capacity

Mil TON SM Anhui Haoyuan Chemical 260KTON

1.1

1.5

1.9

2.4

2.0

1.6

1.2

1.6

0

1

2

3

2015 2016 2017 2018

Chinese Net Trade U.S. Net Trade

Mil TON

SM Plant Outage in Q1-17

0.7 0.6 0.5 0.5

1.31.0

0.6 0.6 0.50.6

1.2 1.1

77% 77%

0%

20%

40%

60%

80%

100%

0

1

2

1H-17 2H-17 1H-18 2H-18 2017 2018

BZ Capacity Addition BZ Demand Growth Operating Rate (RHS)

Mil TON Operating Rate

AP/ME Effective BZ Capacity vs Demand Addition

Qingdao 500KTON

AP/ME Effective SM Capacity Addition

1.0

0.50.4 0.4

1.5

0.80.8

0.3 0.2 0.3

1.1

0.5

0

1

2

1H-17 2H-17 1H-18 2H-18 2017 2018

BZ Maintenance SM&Phenol Maintenance (BZ Equivalent)

Mil TON

Asian BZ, SM and Phenol Plant Maintenance

BZ Capacity Loss Remained Higher than DownstreamC

-42--42-

BASE OIL & BITUMEN

-43--43-

0.3 0.2 0.2 0.0

0.7

2.1

0.0

0.5

1.0

1.5

2.0

2.5

1Q-18 2Q-18 3Q-18 4Q-18 2018 2017

Mil TON Group 1 Group 2 Group 3 Net Capacity

($/TON) 2016 Q1-17 Q2-17 Q3-17 Q4-17 2017Q1TD-

18*

500SN-HSFO

412 451 556 528 458 498 514

New Base Oil Gr.2 Plant Startup Causing Higher Supply Availability

High Asia Pacific Plant Maintenance in Q1-18

Firm Demand during Summer Season

Base Oil & Bitumen


AP Base Oil Nameplate Capacity Addition

AP Plant Maintenance (Effective Capacity)

369399506

450431 427409443367412 451

556528458498 514

Q1

-15

Q2

-15

Q3

-15

Q4

-15

Y2

01

5

Q1

-16

Q2

-16

Q3

-16

Q4

-16

Y2

01

6

Q1

-17

Q2

-17

Q3

-17

Q4

-17

Y2

01

7

Q1

TD

-18

*

Softer Base Oil Market due to Higher Plant Addition

B

A500SN – HSFO ($/TON)


Sources: Argus Jan’18, Kline Sep’17 and TOP’s Estimate

1

2

Global Base Oil Capacity and DemandC

0.5

1.2

0.2

1.8

-1.0

0.0

1.0

2.0

2015 2016 2017 2018

Mil TON

Group 1 Group 2 Group 3 Net Capacity

56.1 56.2 57.4 58.933.8 34.0 34.2 34.4

60% 60% 60% 58%

0%

20%

40%

60%

80%

100%

0

20

40

60

80

2015 2016 2017 2018

Base Oil Capacity Base Oil Demand Operating Rate (RHS)

Mil TONY2018Capacity Growth: 2.4% Demand Growth: 0.6%

3

Operating rate

-44--44-Base Oil & Bitumen

($/TON) 2016 Q1-17 Q2-17 Q3-17 Q4-17 2017Q1TD-

18*

Bitumen

-HSFO(49) (13) (38) (29) (45) (31) (54)

Stable Bitumen Market on Firm Demand

23 20

82 98 56

-7 -48 -61 -80

-49 -13

-38 -29 -45 -31 -54

Q1

-15

Q2

-15

Q3

-15

Q4

-15

Y2

01

5

Q1

-16

Q2

-16

Q3

-16

Q4

-16

Y2

01

6

Q1

-17

Q2

-17

Q3

-17

Q4

-17

Y2

01

7

Q1

TD

-18

*

Bitumen-HSFO ($/TON)


Higher Import Demand from China and India

Rising of Thai Infrastructure Budget

A

C

Sources: Bitumart (Jan’18), Argus (Jan’18) and Thai Bureau of The Budget (2017-2018)

Firm Chinese and Indian Bitumen Market for Development of Transportation System

Limited Bitumen Supply from Some Refinery Maintenances

1

2


7.9 8.2 7.6 8.0

0.02.04.06.08.0

10.0

2015 2016 2017 2018F

Import Volume of Major Asian Players

China India Indonesia Vietnam Net Capacity

Mil TON

Some Plant Maintenances Limit Supply in Asia B

0

50

100

Jan Feb Mar Apr May Jun

AP Bitumen Plant Maintenance in 1H-2018

KTON/Month Fire in Taiwan (shut for 4 months)Maintenance in Malaysia and S.Korea (shut for 2 months)

050

100150200

2015 2016 2017 2018

Thai Infrastructure Budget

Highways dept. Rural Roads dept.

6%YoY GrowthBillion Baht

-45--45-

Linear Alkyl Benzene (LAB)

-46--46-LAB

Stable LAB Market due to Higher Demand amid Lower Plant Maintenance


Seasonal Summer Demand

Lower Plant Maintenance

LAB Market

Source: ICIS Publication (2015-2017),Mitsui, TOP’s Estimate

LAB Spread** ($/TON)

1

2

($/TON) 2016 Q1-17 Q2-17 Q3-17 Q4-17 2017 Q1TD-18*

LAB

Spread606 539 603 534 522 550 528

654666675627656 635627619543

606539

603534522550 528

Q1

-15

Q2

-15

Q3

-15

Q4

-15

Y2

01

5

Q1

-16

Q2

-16

Q3

-16

Q4

-16

Y2

01

6

Q1

-17

Q2

-17

Q3

-17

Q4

-17

Y2

01

7

Q1

TD

-18

*


**Estimated indicator

KTA AP/ME Effective Maintenance/Closure*

050

100150200250

1H-17 2H-17 1H-18 2H-18

2017 2018

Thailand Japan Indonesia Taiwan

Iraq South korea India China

*Temporary

-47--47-

CONCLUSION

-48--48-Conclusion

1H-18 Market Outlook Conclusion(vs. 2H-17)

Crude Oil

Refinery

Lube Base

LAB

Aromatics

Firm Petroleum Product Market from Robust Demand Growth and Limited Supply

Sustaining Crude Prices with Downward Trend amid Surging U.S. Supply

Softer Base Oil Market due to Higher Additional CapacityStable Bitumen Market on Firm Demand

Stable LAB Market due to Higher Demand amid Lower Plant Maintenance

Stable-to-Firm Aromatics on Demand Growth and Downstream Plant Addition

-49--49-

Thank You

Any queries, please contact:

at email: [email protected]

Tel: 662-797-2999 / 662-797-2961

Fax: 662-797-2976

-50--50-

APPENDIX

• Strategic Investment Plan

• Optimized & Flexible Operations…Superior Performance

• CDU Addition VS Additional Demand – AP & ME

• World GRM / Inventories

• Thailand petroleum demand by products

-51--51-

Planned capital investment

Strategic Investment Plan Approved by Board of Directors CAPEX Plan (Unit US$ million)

Notes: Excluding approximately 40 M$/year for annual maintenance$315m

Updated as of January 2018

Project2017 2018 2019

Reliability, Efficiency and Flexibility Improvement 40 26 6

Benzene Derivatives – LAB 1 2 5

Power – 2 SPPs 2

Infrastructure Improvement

- Lorry Expansion 7 2

- Jetty 7&8 / Improvement 13 72 46

- Office Relocation & New Crude Tank 38 88 10

- Site office preparation for fire water & fire water improvement 40 3

Other Investments ( i.e. solvent distribution in North Vietnam ) 3 15

Total 104 245 70

Updated CAPEX plan

-52--52-

Thai Oil is able to diversify its type of crude intake and product outputs to maximize demand and margin

Optimized & Flexible Operations…Superior Performance

27%17%

7%17%

28%29%

28%28%

45% 54%65%

55%

Oman Dubai Murban ArabLight

Short Residue Waxy Gasoline/Distillates

Sources of Crude

• Flexibility in crude intake allows diversification of crude types to source cheaper crude

• Flexibility in product outputs by maximizing middle distillates (jet and diesel) by adjusting production mode to capture domestic demand and price premium

• Maximize Platformate production to capture higher margin on aromatics

• Minimize fuel oil output to avoid lower margin products

Product output

Domestic demand for

petroleum products**

**Source: Energy Policy and Planning Office, Ministry of Energy Thailand

% S = 0.78API = 39.4

% S = 1.43API = 32.0

% S = 2.52API = 31.2

Crude Assays based onTOP configuration*

*** Including Nigeria, Russia and others

% S = 1.97API = 32.8

*Crude yield as per assay in Spiral as of Feb 2016

74%

8%

8%

10%

5%

7%

34%

22%

16%

12%

4%

4%

43%

12%

20%

21%

Middle East

FY/17

SAUDI ARAMCO

MOPS Jet Kerosene FOB

SG

MOPS Gasoil 0.05% Sulfur

FOB SG

MOPS ULG 95 FOB SG

OthersLPG

PLATFORMATE

GASOLINE

JET

DIESEL

FUEL OIL

FY/17

***

LONG RESIDUE

MOPS Fuel Oil 180 CST 3.5% Sulfur FOB SG

Reference Price

Crude

LocalFar East

-53--53-

Asia Pacific and Middle East Refinery Addition

Refinery

Sources: FGE Energy Semi Annual Reports, Fall 2017, Reuters (Feb’18) , IEA Medium Term Outlook (Mar’17) and TOP’s estimate

Note: Adjusted capacity based on start-up period (effective additional capacity)

(Mar’18 > Apr’17)

Start-up period)

CountryNameplate

(KBD)Company

Q3-17 India 42 HPCL Bhatinda

China 260 CNPC/SA Anning

China 200 CNOOC Huizhou

India 120 BPCL - Kochi

Q4-17 Taiwan 47 CPC Talin

Q1-18 China 100 Local Zhuhai Huafeng

Q2-18 China 100 Petrochina Huabei

Iran 120 Bandar Abbas - PGSOC/1

India 36.1 Bharat - Bina

Q3-18 Vietnam 200 Nghi Son

Kuwait 171 KPC - Mina Abdullah

Q4-18 China 120 CNOOC/Local Ningbo Daxie

Closures

Q2-17 Kuwait -186 KPC - Shuaiba

Q4-17 China -100 Local refineries

Saudi Arabia -84 Jeddah

Q1-18 Japan -160 JX group and Cosmo Oil

Q3-18 Kuwait -112 KPC - Mina Al-Ahmadi

(Oct’16 > Jul’17)

(Feb’17 > Sep’17)

(Feb’18 > Aug’18)

(May’16 > Sep’17)

(Aug’17 > May’18)

(Mar’18 > Jun’18)

(Dec’17 > Mar’18)

454562

5

474565

1207

-1000

0

1000

2000

2015 2016 2017 2018 2019 2020

KBD

Teapot IndiaJapan Other APChina ME CloseMiddle East Net AdditionAP & ME Demand Growth

(Apr’22 > Nov’17)

-54--54-

Asian Margin Vs. US-EU margin

World GRM

12

13

14

15

16

17

18

19

1 5 9 13 17 21 25 29 33 37 41 45 49

U.S. Crude Refinery Input

5yr-range 20172018 avg 13-17

MBDSource : EIA

8

9

10

11

12

1 2 3 4 5 6 7 8 9 10 11 12

EU 16 Crude Refinery Input

5yr-range 20172018 avg 13-17

MBDSource : EurOil

2.5

2.7

2.9

3.1

3.3

3.5

3.7

3.9

1 5 9 13 17 21 25 29 33 37 41 45 49

Japan Crude Refinery Input

5yr-range 20172018 avg 13-17

MBDSource : METI

Total Capacity: 3.5 MBD 90.43% 69.68% 95.71%Total Capacity: 18.1 MBD Total Capacity: 15.8 MBD

-55--55-

250

300

350

400

450

500

550

600

1 5 9 13 17 21 25 29 33 37 41 45 49

U.S. Crude Stocks (excl. SPR)

5yr-range 2018 2017 avg 13-16

MBBLSource : EIA

Global Crude Oil Inventories

Inventories

0

10

20

30

40

50

60

70

80

1 5 9 13 17 21 25 29 33 37 41 45 49

Crude Oil, Cushing, Oklahoma

5yr-range 2018 2017 avg 13-17

MBBLSource : EIA

60

70

80

90

100

110

120

1 5 9 13 17 21 25 29 33 37 41 45 49

Japan, Crude Stocks

min 5yr-range 2018 2017 avg 13-17

MBBLSource : METI

420

430

440

450

460

470

480

490

500

510

1 2 3 4 5 6 7 8 9 10 11 12

EU 16 Crude and Feedstock Stocks

5yr-range 2018 2017 avg 13-17

MBBLSource : EurOil

-56--56-

180

200

220

240

260

280

1 5 9 13 17 21 25 29 33 37 41 45 49

U.S. Gasoline Stocks

5yr-range 2018 2017 avg 12-16

MBBLSource : EIA

Global Gasoline Inventories

Inventories

0

5

10

15

20

1 5 9 13 17 21 25 29 33 37 41 45 49

Japan, Gasoline Stocks

5yr-range 2018 2017 avg 12-16

MBBLSource : METI

80

100

120

140

1 2 3 4 5 6 7 8 9 10 11 12

EU 16 Gasoline Stocks

5yr-range 2018 2017 avg 12-16

MBBLSource : EurOil

0

10

20

1 5 9 13 17 21 25 29 33 37 41 45 49

Singapore Gasoline Stocks

5yr-range 2018 2017 avg 12-16

MBBLSource : IE Singapore

-57--57-

80

100

120

140

160

180

1 5 9 13 17 21 25 29 33 37 41 45 49

U.S. Diesel Stocks

5yr-range 2018 2017 avg 13-17

MBBLSource : EIA

Global Middle Distillate Inventories

Inventories

0

5

10

15

20

1 5 9 13 17 21 25 29 33 37 41 45 49

Japan, Middle Distillate Stocks

5yr-range 2018 2017 avg 12-16

MBBLSource : METI

300

350

400

450

500

1 2 3 4 5 6 7 8 9 10 11 12

EU 16 Diesel Stocks

5yr-range 2018 2017 avg 13-17

MBBLSource : EurOil

0

10

20

1 5 9 13 17 21 25 29 33 37 41 45 49

Singapore Middle Distillate Stocks

5yr-range 2018 2017 avg 13-17


-58--58-

20

30

40

50

1 5 9 13 17 21 25 29 33 37 41 45 49

U.S. Residual Fuel Oil Stocks

5yr-range 2018 2017 avg 13-17

MBBLSource : EIA

Global Fuel Oil Inventories

Inventories

0

5

10

15

20

1 5 9 13 17 21 25 29 33 37 41 45 49

Japan, Residual Fuel Oil Stocks

5yr-range 2018 2017 avg 13-17

MBBLSource : METI

60

70

80

90

100

1 2 3 4 5 6 7 8 9 10 11 12

EU 16 Residual Fuel Oil Stocks

5yr-range 2018 2017 avg 12-16

MBBLSource : EurOil

0

10

20

30

40

1 5 9 13 17 21 25 29 33 37 41 45 49

Singapore Residual Fuel Oil Stocks

5yr-range 2018 2017 avg 13-17


-59--59-

China’s Refined Product Exports

China Export

0

50

100

150

200

250

300

350

400


China’s Gasoline Exports

2015 2016 2017 2018

KBDSource : China Custom

0

100

200

300

400

500

600


China’s Gasoil Exports

2015 2016 2017 2018


0

50

100

150

200

250

300


China’s Fuel Oil Exports

2015 2016 2017 2018


0

100

200

300

400

500


China’s Jet/Kero Exports

2015 2016 2017 2018


-60--60-

Domestic LPG Demand

LPG Demand by Sector

LPG Demand Highlight

• In 2017, LPG demand increased slightly by 0.9%YoY on account of 6.9%YoY higher demand from petrochemical sector, as a result of PTTGC major shutdown in May16-Jun16. Moreover, LPG demand was also supported by 2.2%YoY, and 6.7%YoY higher demand of cooking sector, and industrial sector, respectively. However, LPG demand in automobile sector fell by 9.8%YoY, according to low level of oil price.

Outlook for 2018

• LPG demand is expected to dropped by 1.7% YoYpressured by the expectation of more fuel switching from LPG to Mogas, due to low oil price.

• However, the slowdown of LPG demand was expected to be limited by higher usage in industry sector as a result of persistent low level of LPG price.

Thailand LPG Demand

Remark : LPG demand includes Petrochemical and own used consumption

Source: EPPO, DOEB (As of February 2018)

Thailand petroleum demand by products

-61--61-

Domestic Gasoline/Gasohol Demand

Gasoline/Gasohol Demand by Grade

GASOLINE/Gasohol Demand Highlight

• In 2017, Mogas demand rose moderately by 3.7%YoY to an average 30.0 ML/day. Although, the retail price of Mogas is higher, Mogas demand was still supported by consumers’ intimation that using their personal cars in their routine. Moreover, Mogas demand is also supported by better Private consumption, according to 23.7%YoY higher passenger car sale in this year.

• The level of domestic ethanol demand, in 2017, rose significantly by 7.3%YoY from 3.67 mml/day to 3.94 mml/day following the rising of Mogasdemand. Additionally, this was also because of higher demand in GSH-95, E20, and E85 which increased by 9.9%YoY, 8.9%YoY, and 18.5%YoY, respectively, backed by increasing in the number of new E20 vehicle, E20 gas station, wider GSH95-E20, and E20-E85 price gap.

Outlook for 2018

• Mogas consumption is predicted to grow by 3.1% YoY supported by expectation of growing of new passengers cars from return of private consumption. However, the demand is limited by high growth level in 2017 and higher oil price.

Thailand Gasoline/Gasohol Demand

Source: DOEB (As of February 2018)


-62--62-

Domestic Jet Demand

JET-A1 demand and # of flights

JET Demand Highlight

• In 2017, Jet consumption increased significantly by 4.4% over the corresponding period last year mainly owning to booming tourism industry, leading to 5.4%YoY higher aircraft movement. The expansion in tourism sector was a result of increasing number of Chinese, Indian and European tourists, pushing the number of flight movements higher both international and domestic aircrafts. However, Jet demand was pressured by new domestic excise tax which implemented since Feb-17.

Outlook for 2018

• Jet demand growth is expected to grow by 2.5%YoY as a result of rapid tourist number growth, especially from China and ASEAN. Furthermore, the demand is also supported by the return of European and Russian tourists. However, the demand growth is limited by high level of utilization rate of SBA and DMK airports.

Thailand JET-A1 Demand

Source: DOEB, AOT, Department of Tourism (As of February 2018)


-63--63-

Domestic Gasoil and NGV Demand

NGV Demand

Diesel Demand Highlight

• In 2017, Diesel demand rose moderately by 2.9% YoY as a result of Thai economic recovery. However, Diesel demand was still pressured by flooding situation in Southern part of Thailand which lower agricultural activity and goods transportation. Meanwhile, in 2016, Diesel demand in Southern part of Thailand took approximately 12.5% of total Diesel demand in Thailand.

Outlook for 2018

• Diesel demand in 2017 is expected to expand by 1.9% YoY supported by Thailand economic improvement.

NGV Demand Highlight

• In 2017, NGV demand fell significantly by 9.1%YoY. This was mainly because of consumers’ intimation that still prefer to consume oil. Moreover, the low oil price level in 2017 has pressed the fuel switching from old cars, whereas the new cars which is available for NGV was lower recently.

Thailand Gasoil Demand



-64--64-

Domestic Fuel Oil Demand

Thailand Fuel Oil Demand by Sector

Fuel Oil Demand Highlight

• In 2017, Fuel Oil consumption fell sharply by 6.6%YoY, as a result of sharply falling by 55.0%YoY of electricity sector demand which pressured by fewer day of Myanmar gas field maintenance Furthermore, the demand in industrial sector also decreased by 14.1%YoY, as a result of higher price of fuel oil, comparing to other fuel. However, the demand in transportation sector rose by 10.0%YoY from improving Thailand export activity.

Outlook for 2018

• Fuel oil demand is expected to increase by 1.1%YoY, as a result of higher transportation demand from better export activity.

Thailand Fuel Oil Demand



-65--65-

Thank You

Any queries, please contact:

at email: [email protected]

Tel: 662-797-2999 / 662-797-2961

Fax: 662-797-2976

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