BANGKOK, Thailand PTT Public Co. Ltd., Thailand’s largest petroleum company, sees the Philippines remaining the biggest contributor to its overseas operations in the medium term due to its aggressive expansion in the country.
The Thai oil firm is targeting a 20 percent contribution in revenues from its overseas retail business by 2020, PTT vice president for international marketing Wisarn Chuwalitanon said in an interview.
“We really want to grow in other Asean (Association of Southeast Asian Nation) countries that’s why we have to work hard in expanding our retail network,” he said.
PTT has laid down a five-year expansion plan in countries it has existing oil retail business to take advantage of the Asean Economic Community (AEC).
The AEC sets in motion the creation of single market for the 10-nation bloc, taking advantage of more than 600 million consumers in the region. Asean groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam.
“We called on our partners in the Philippines, Laos, Cambodia and Myanmar for brainstorming for strategy so we know clearly where we’re going to go,” Chuwalitanon said.
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Under the plan, PTT targets to have 60 stations in Laos from the current 18 71 stations in Cambodia from 20 more than two stations in Myanmar and 300 stations in the Philippines from 85.
Last month, PTT Philippines Corp. president and CEO Sukanya Seryodin said the local unit will be spending P1 billion for expansion to help it secure a bigger market share from the current 2.4 percent.
With the expected number of stations, Chuwalitanon said the Philippines will still be the company’s biggest overseas operations.
He explained the network in other Asean countries is smaller because of the size of population and foreign ownership limits.
“The Philippine market is our priority market. It currently has the biggest operations compared with the other Asean countries,” the PTT official said.
“Our revenue in the Philippines is more than 20 billion baht (P26 billion) compared with the other countries which have around five billion baht (P6.5 billion). That’s why we pay attention to the Philippines,” he added.
In line with its expansion, PTT is eyeing to partner with small players to be able to compete with the bigger oil players. Currently, the local oil industry is dominated by Petron Corp., Pilipinas Shell Petroleum Corp. and Chevron Philippines, which operates the Caltex brand name.
“The Philippines still has fragment of investors because of you have a deregulated market. Some Filipino-owned companies only have 5-10 stations… that is one of our targets, how we can compete in networking,” Chuwalitanon said.
Part of the Thai firm’s strategy is to provide these small players with services and the brand to have higher standards.
“That’s the way we’re going to go, it’s not like merger but partnership. We will invite them to join our network to bring up the standards to compete with the big guys,” Chuwalitanon explained.