PTT Public Company Limited (PTT) Earnings Call Transcript & Summary

Welcome to the analyst meeting, reporting results of Q4 and year-end. As always, you can send in your questions using chat boxes. We have our CEO and CFO here, starting with CEO, Khun Auttapol Rerkpiboon and CFO, Khun Phannalin, please? .

Good morning, dear analysts, fund managers. Today, we are here to talk about Q4 performance on the whole year 2021. I would like to start with highlights of key activities, starting with establishment of Nuovo Plus JV between Arun plus 51% and GPSC, 49%, THB 4.2 billion registered capital in order to support battery business value chain, Nuovo Plus has transferred -- has bought assets of subsidiaries within PTT and GPSC, starting with energy storage, semi-solid batteries using 24M Technology, 30 meg pilot plant and Axxiva in China and, thirdly, altogether, THB 2.9 billion in order to have Nuovo Plus as the battery arm of the PTT Group. Second, we established Horizon, its JV between Arun Plus and Lin Yin, which is a subsidiary of Foxconn THB 2.3 billion capital to operate EV manufacturing business. Final investment decision is due in the first half of this year, and COD is expected in first Q of 2024. Third, we established ReAcc Plus, which is a trading platform or applications for clean energy trading and climate neutrality. Through digital platform, enabling our produce to buy clean energy. We also established GPC International Terminal, a joint venture between PTT Tank 30%, CHEC OVERSEAS and GULF 40% to operate commercial port in Laem Chabang. Fifth, Innobic Asia joint venture with Aztiq HK Limited to buy shares, all shares of Alvogen, which is the major shareholder of Lotus Pharmaceutical. The investment value is at USD 475 million. If this deal is finalized and anticipated within Q1 this year, it will make Innobic to hold 30% stake in Lotus Pharmaceutical allowing PTT to operate end-to-end pharma business from R&D, formula, research and distribution. So that's our entry into lifestyle sector. Number six, PTT Energy Resources or PTT ER has sold shares of East Mediterranean Gas or EMG, which operates pipeline business in Egypt. We sold to Snam, which is an Italy-based company, the value is USD 50 million. EMG will stop being joint venture partner. So total divestment. Let's talk about our group, starting with PTTEP. PTTEP bought 25% stake in Concession Area C from Eni. This is natural gas and condensate onshore in the middle of Ghasha of U.A.E. So that aligns with PTT's strategy focusing on the Middle East. And OR has bought shares in KAMU KAMU at THB 480 million or about 25% stake, KAMU KAMU makes bubble teas and other beverages. This is to diversify OR's product portfolio and strengthen its food and beverage business. Those are key activities. May I talk about key business drivers. Overall, I think we all know that crude, natural gas, petrochem product prices that PTT use in referencing our prices, most products increase -- prices increased across the board, Q4 compared with the previous quarter, as well as annual average '21 compared with '20 mainly due to robust demand on the back of global economic recovery and vaccination rollout and many countries are opening up and practicing internal economic stimulus. Dubai crude Q4 averaged at 78.4, fuel oil 71.5. So these benefit from higher demand propelled by economic recovery. And on the back of higher gas price, that has propelled autogas switch and natural gas on PTT's part, Q4 at $8.14 per million Btu, higher by 19% Q-on-Q and year-on-year, 5% increase, mainly due to higher LNG import price even though dollars and Myanmar gas price comparing year-on-year, decreased on the back of EURO or THB expensive LNG report pushes up average full gas price. Petrochemical prices. Olefins, Q4, PP $1,335, HDPE $1,231 per ton, up on the back of crude and naphtha price is also higher and lag time in production amongst different plants as well as higher demand for online shopping. Whereas Aromatics Q4, benzene $996 per ton, PX $963, so down due to concerns over dual control policy, saw less demand from downstream producers and inventories in China remain high. In any case, year-on-year, it is improving. So on the back of global economic recovery and easing of lockdowns and along the direction of upward oil prices, FX Q-on-Q, FX gain due to stronger baht. Whereas 2021 compared to 2020, FX, we suffered FX loss due to weaker baht. So those are our key drivers and Khun Phannalin will start on key financial performance.

On PTT, I would like to speak very briefly because we have already reported our financial standings. I think you probably digested our financial statements in Q4 last year. Revenue Q-on-Q is 23% higher from THB 563 billion to THB 600 billion. It's higher across all business groups, driven by both factors of average selling prices of petro and petrochem products. According to global pricing as well as higher sales volumes on the back of economic recovery. EBITDA Q-on-Q is down by about 8% from THB 110 billion to THB 101 billion, mainly because of P&R, NG and trading business, P&R is lower because of petrochem, according to the scaling down of spreads. Refinery business. In fact, accounting GRM increase from 3.2 to 5.9 per barrel in Q4, according to market GRM. Market GRM increased from 2.1 barrel in Q3, resulting in 5.5 barrel in Q4. And as a result, refinery business has better account GRM. Again, thanks to easing of lockdown measures in various countries. For gas business, EBITDA is down due to supply business and NGV business because average pool gas price increased as well as NGV itself. We try to subsidize the price even though our gas separation business performance is good because of average higher selling price. Trading business decreased mainly because of recognizing mark-to-market losses. So that's the main reason for EBITDA decrease for trading. For business and infrastructure, EBITDA is down because of GPSC, the lower profits due to higher gas costs and sale to industry users decreased according to planned maintenance shutdown. E&P business, EBITDA higher due to average selling price on the back of higher oil prices and average price is a little bit up in Q4. Oil business EBITDA up on the back of higher sales following both oil and non-oil due to easing of lockdowns and opening up the country for tourism. For net income Q-on-Q up 16% from THB 33 billion to THB 27 billion. This is chiefly because of loss -- derivatives loss. Because GC, PTT trading and PTTEP. So because of the oil price rise was less than previous quarter, resulting in less loss, plus factors because FX gains increased by about THB 11.5 billion due to strong baht, 0.5 satang in Q4. Whereas Q3, baht was weaker by 1.9 per dollar resulting in EBITDA being positive factor, but still there's negative factor that is increase in income tax, THB 4 billion due to improved performance of P&T and nonrecurring items, more loss by about THB 6.4 billion due to recognition of asset impairment of PTT by about THB 7 billion, I will explain details later. In terms of performance for the whole year, revenue increased by 40% from THB 1.6 trillion to THB 2.2 trillion across our business units due to the higher average selling price. So that's the main driver. EBITDA, up by 90% from THB 2 billion to THB 5 billion to THB 428 billion. Key attributes from business, especially P&L last year, we suffered quite high stock loss, but this year, it has turned to be stock gain. As a result, P&R's EBITDA has improved significantly, whereas petchem business improved as well because of the spreads in olefins and aromatics. E&P EBITDA is higher on the back of higher sales volume, mainly because of Oman Block 61, Malaysia H starting to produce in February last year and also Bongkot, Contract4, and Arthit, which is buying more plus average selling price that is higher on the back of crude oil price. For gas business EBITDA up because of gas separation plant business, which is in every factor higher selling price, higher volume of sales and lower gas pool price. So these are the key 3 factors boosting performance of gas separation plants last year. And also S&M sales and marketing business, EBITDA is higher as well on higher selling prices to industry users, reference to fuel oil price in the formula, and sales volume is higher as well. Trading EBITDA improves according to margins of condensate domestically, and higher sales volume. Oil business EBITDA is better because of oil, benzene and diesel, higher profits, and profits of non-oil decreased due to higher marketing costs despite higher volume of sales. Business and infrastructure EBITDA is down chiefly because of GPSC. Our new business, its contribution to performance is from GPSC, which we classify in this group, GPSC. Profits from SPP down due to gas and coal prices that have become higher and more shutdown maintenances of SPPs. Net income for 2021 higher by more than 100% compared to -- well, THB 37 billion, up to THB 180 billion. So better EBITDA, as I mentioned. In any case, there are direct factors. So tax income increased according to performance by about THB 42 billion and loss -- derivative loss by about THB 34 billion because when oil price is higher and we've done derivatives before socially, losses would increase, but that would be offset by physical higher price. For non -- for net tax nonrecurring items, in 2021, losses decreased by about THB 2.5 billion, we will elaborate in the slides to come. May I skip to cash waterfall, you will see that Q4 Q-on-Q, as I said, net income higher by 16% or THB 39 billion, but if we separate by categories, we see that in terms of margins, they are down by THB 714 million due to trading. THB 3.7 billion, mark-to-market and gas business, down by about THB 2.3 billion. S&M higher gas costs, and LNG, more LNG imports resulted in higher gas costs and take or pay of Myanmar gas, if you recall, we have to compensate the state by about THB 2.7 billion. Positive factors. We received shortfall payment from the producers because they could not meet the committed volume. So we gained the shortfall but sales volumes down from power plant segment. For NGV, losses increased. According to higher pool gas price and trading, we try to stabilize NGV price. And so the margins of NGV are in the loss territory. For P&R, minor stock in loss, we separate it into a different category. P&R margins down by about THB 900 million from Aromatics business where product spread is down and olefins, less sale volume and hence, impacting the picture. Whereas refineries actually improved when it comes to utilization rate from 88% to 102% because Q3, GC did schedule maintenance shutdown, IRPC as well, 45 days, but demand increased due to easing of lockdown measures and market GRM also increased from $2.1 to $5.5. As I mentioned earlier, now new business and infrastructure margins decreased by about THB 450 million due to higher gas and coal costs on GPSC. But where margins are higher, from PTTEP by about THB 3.3 billion due to a 6% increase in selling price of both liquid gas and slightly higher volume, 1% from Malaysia and MTJDA. Oil Business, margins higher by THB 2.7 billion of both oil and non-oil. Higher selling volume core business better by about THB 937. According to Newcastle benchmark price. Last year, coal price has improved quite substantially and sales volume also increased in line with demand. For stock gain, you will see that is decreased by 3.4 billion from 18 to a gain of 3 billion. And so stock gain decreased. OpEx higher by about THB 5 billion because of human resource expense, payment of external contractors, PR spending. Depreciation and amortization down by about 5.4 because of PTTEP Bongkot project because they have revised the cost of decommissioning. Other income down by THB 1.3 billion because of recognition of loss of divestment of Emery of GC, but at the same time, gain from E&D THB 1.4 billion. So they net off each other. Impairment higher by about THB 8.3 billion chiefly because in Q4, recognition of PTTEP's impairment in Mozambique and Yetagun, THB 6.1 billion. PTT itself, recognizes impairment of NGV THB 3 billion. FX and derivatives improved by about THB 23 billion. FX loss is less of losses because of commodities derivatives and FX gain is better by THB 15 billion due to a stronger baht as we mentioned earlier, half a baht stronger. For corporate income tax and noncontrolling interest, that's a negative factor by about THB 5.7 billion. So THB 4.2 billion more in tax expenses because PTTEP has higher profits and higher interest expense by about THB 300 million. Waterfall for the whole year, net income higher than 100%, you will see that the main attributes are from much improved margins, THB 148 billion from every single factor ranging from E&P, better margin by THB 56 billion, from both higher sales volume, 18%, due to acquisition of Oman Block 61, Bongkot, Contract4, Arthit and Malaysia Block H and average selling price, up 12%. According to higher liquid price, P&R margin better by about THB 55 billion because of refinery business, which has higher stock gains and market GRM. Petrochem business, where prices and spreads are higher, both for olefins and aromatics. Gas business improved both separation plant and S&M. GSP, both selling price and volume less cost. As I talked about earlier, S&M, better margins from average selling price and higher volume. Stock gain is a positive factor by THB 65 billion because in 2020, we had stock loss, whereas 2021, stock gain of about THB 46 billion. So that has improved substantially, but negative factors are from OpEx, higher by THB 11 billion, again, from human resource and logistics costs. DD&A higher to the tune of THB 7 billion due to PTTEP's acquisition of Oman Block 61. Other income higher by THB 5.3 billion because of mostly onetime items. So goodwill acquisition of more Oman Block and writing off of the project in Brazil. So on the basis of 100% and profits from selling the pipeline business in Egypt, THB 4 billion and loss from Emery restructuring of GC. So all are calculated within this basket. Impairment after net higher by about THB 1.3 billion because of recognition of PTTEP's Mozambique, Yetagun and NGV and for GC U.S. projects about 1.9 billion. In 2020, we recognized impairment for coal about THB 8.7 billion in Mariana Oil Sands and Yetagun of PTTEP, THB 2.8 billion. FX and derivatives loss are higher by about THB 50 billion because in 2020, we have gains of about THB 11 billion, but 2021 loss of THB 38 billion. So after netting the difference looks like FX and derivatives are very high in the range of THB 50 billion, mostly because of commodities price hedging for EP trading, IRPC, Thai Oil, GC and PTT itself. For FX loss is higher by THB 15.7 billion because of weak baht. For lastly, interest NCIT and NCI you see that these are negative factors by about THB 78 billion because of higher tax expenses by THB 40 billion and NCI, higher by about THB 41 billion thanks to improved performance. So that's the cash waterfall. Now for the PTT business itself, if you look at Q-on-Q performance. So Gas Business & Trading business, Q-on-Q EBITDA for PTT only dropped 18% from THB 25 billion to THB 20.6 billion in Q4 as a result of gas EBITDA on the haul dropping 18% mainly from S&M EBITDA lower by 63% because of higher gas costs at 19% because of LNG import at higher volumes. And in fourth quarter, more spot LNG were imported to replace Gulf of Thailand gas towards the end of Erawan and Bongkot concession and to also supplement the Sirikit field gas step down. And sales volume dropped 2% from 4,224 MMCFT to 4,158 MMCFT mainly from power plant customers. On other costs, increased under S&M EBITDA because of take or pay of Myanmar gas returned to government at THB 2.7 billion when netting with the payment for delivery shortfall at THB 1.7 billion. And the growing and selling average price to customer, industrial customers also increased in line with F or reference price. TM EBITDA dropped 7% because of the higher pooled gas costs by 90% and the higher maintenance cost in Q4. GSP EBITDA Q-on-Q, higher by 3% because of higher average selling point because of the rising petrochem prices that we use as reference. Volume dropped by 3% from 1,694 kTon to 1,634 kTon in Q4 because of the lower LPG sales volume on the back of falling demand in the petrochemical segment and the lower production capacity of GSP's in certain sites and delivery also lower. Feed costs increased by 1.5%. NGV loss increased by THB 787 million, or over 100% mainly because of lower margin as a result of higher pool gas cost and the price cap of NGV. And as we already mentioned that we will maintain NGVs price until the 15th of March this year. Sales volume increased by 19% because of higher oil price for end users to switch to gas. And so the volume increased from 2.7 kTon in Q3 to 3.2 kTon in Q4. Others dropped by THB 391 million, mainly from PTT NG because of higher gas costs linked to FO price. Trading EBITDA dropped by 25%, mainly because of lower margin by 44% from THB 0.16 to THB 0.09 but per liter, because of MTM loss, but sales volume down 48% from 16 million liters in Q3 to 25 million liters in Q4 because of the higher crude -- higher sales of crude imports and sales of crude bought on the back and in addition to the easing of lockdown and the demand of -- more demand of LNG and refined oil products as well. For the year-to-year EBITDA increased 59% from about THB 58 billion in 2020 to THB 91 billion in 2021. If you look at the contributions come from gas and trading, which you see is a better improvement. S&M EBITDA increased by 7% because of higher average selling price and sales volume also increased, 5% increase of pooled gas costs play a negative effect. Other costs include take-or-pay from Myanmar gas field 2.7%. That's also another negative factor. TM EBITDA dropped by 5%. Mainly from the drop in the number of pipelines. Customers in the non-firm group, namely SPP Industry, NGV in line with the gas use trend. GSP EBITDA improved more than 100% from 2020 whereby GSP suffers overall negative factors. In 2021, we enjoyed 3 types of positive factors. Therefore, the performance improved by 100% in terms of EBITDA. NGV EBITDA dropped by 29% as a result of higher pool gas and the price cap of NGV. And overall, the sales volume also dropped by 20%. Others, EBITDA include by 25%, mainly from PTT and DD because of improved performance as a result of better selling -- average selling point reference to FO price and the higher sales volume. Meanwhile, PTT LNG may continue to make stable income contribution to PTT. Trading EBITDA improved by 80% to positive factors mainly margin improved by 49% from THB 0.07 to THB 0.10 per liter from margin condensate. That it is higher as a result of better spread margin and the discount from the earnings per unit. LPG, LNG, and aromatics are also on the rise. Volumes increased by 5% from 75 billion liters in 2020 to almost 90 billion liters in 2021 because of sales of imported crude and export of crude as well as the sales to refineries increased as well as sales of petrochemical as well. On the financial position, balance sheet increased by 21% or THB 534 billion cash. Now PTT is in the reinvestment mode, we spend money investing resulting in cash on hand and short-term investment, probably less. Other current assets increased by about THB 180 billion, mainly because of inventories and account receivables. And noncurrent assets increased by about THB 200 billion because of intangible assets and goodwill from the acquisition of Allnex of GC, investment in Chandra as CEO of Thaioil and Avaada's investment by GPSC resulting in other noncurrent assets increase. Land property, PP&E increased by THB 1.3 billion because of PTTEP's acquisition of Block 61 Oman and construction of CFP of Thaioil resulting in higher PP&E. And in terms of liabilities and equity, when -- with the increase of noncurrent assets, other liabilities will increase accordingly. So up by more than THB 100 billion due to higher price factor. Interest-bearing debt higher by about THB 150 billion because last year PTT Group has borrowed long term and issued debentures because of GC, PTT and Thaioil. Equity increased by THB 187 billion. On the back of net income, higher net income and OR has finished the IPO. Financial ratios, net debt-to-EBITDA in 2021 is down from 1.68 to 1.37. Even though net-net are higher, but group EBITDA has recovered more, resulting in less financial ratio, but net debt to equity is higher from 0.29 to 0.40. But overall, they are still within PTT's framework of financial ratios. For cash flows, consolidated cash flows towards end of last year, we have cash and cash equivalents at THB 332 billion, but between year netting cash out is THB 19 billion, so by year-end, ending cash is at THB 317 billion. So these factors are explained by cash flow from operations last year. We received about THB 322 billion but investing activities, we are actively investing, spending THB 385 billion on what, as I said, GC bought Allnex. PTTEP acquired Block 61 Oman, Thaioil invested in Indo, GC in Avaada. So we invested THB 256 billion CapEx, mainly from Thaioil, PTTEP investment in S1, Mozambique and G2/61 LNG is under construction, the port at Mat Ta Phut and the fifth gas transmission pipeline. So that explains the CapEx. Others are about short-term, long-term loans within group. THB 28 billion and bonds are up for redemption. So current investment, THB 34 million dividend interest received THB 7.2 billion, so after netting free cash flow is minus by THB 62 billion. Let's take a look at financing activities. We have borrowed from financial institutions, issuing bonds to the tune of 200. Repayment happened as well. So after netting the borrowing is higher by about THB 100 billion. OR received IPO, THB 55 billion and pay dividend across groups, THB 78 billion and interest payment, THB 22 billion. So after netting THB 46 billion plus adjusted factor cash out THB 19 billion, so ending cash, THB 312 billion. Plus short-term investments that we have, THB 49 billion. Therefore, cash ending plus short-term investment is at THB 361 billion. Now the CEO will talk about CapEx.

For the 5-year investment plan, committed CapEx of PTT and wholly owned subsidiaries, total USD 3.2 billion consisting of 80% investment in core businesses, namely 45% natural gas into GSP to #7, which will have the capacity replacing Unit 1, 460 million MMCFD, COD, 2023 GSP #8, well, for imported LNG, COD, about 2025 and gas pipeline 20% consisting of Bank Pakong, South Bangkok, COD 2025 and onshore, the 5th onshore pipeline to be completed at the end of this year and LNG receiving terminals, 17% investment and this will increase the capacity of the second LNG terminal, 7.5 million ton per annum, COD in 2022. New business and infrastructure consisting of EV value chain of Arun Plus, Laem Chabang Port Phase III, new businesses through Innobic and investment in venture capital, EECi, so altogether, 16% and 2% investing in international trading activities. Apart from committed CapEx, we also have provisional capital expenditure. And over the next 5 years, the amount earmarked is THB 238 billion to support PTT strategic mission, powering life, future energy and beyond. So investment provisionally will be geared towards new business, new energy sources, namely clean energy and renewables, about 12,000 megawatts within 2030 and other new businesses, such as life science, pharmaceutical, nutrition, medical devices, logistics and infrastructure as well as LNG value chains. So that will be covered by provisional CapEx of about THB 238 billion. Now on committed CapEx of PTT Group over the next 5 years, will be worth THB 944 billion or USD 29 billion, 54% of which will go to upstream businesses on -- for onshore, offshore exploration and production projects such as Bongkot and Erawan, Mozambique Area 1, Algeria and Southwest Vietnam. Those are the projects located abroad. For downstream projects, will take up about 31% in GC acquired Allnex, our next TOP invested in clean fuel project. OR will expand in both oil and non-oil businesses in as well as out of the country, IRPC will continue to invest in ultra clean fuel project. Power business received 4%, mainly in renewable energy sources, including solar and wind, and the energy recovery unit or ERU. The provisional capital expenditure over the next 5 years of the whole group totaled about THB 747 billion. Now let me touch on our ESG strategy. Because of concern on -- for the world environment, the Prime Mister delivered a statement at COP26 that Thailand will achieve carbon neutrality by 2050 and net zero emissions by 2065 and that forms the basis for our policy -- our environmental policy. I will start with the environmental front first. We have used the Prime Minister statement on Thailand's vision concerning sustainability as the basis for formulating our environmental policy. We reviewed the ESG emission target and want to reduce the emission by 15% to achieve Thailand's net zero vision. And in 2021 last year, absolute ESG emissions Scope 1 and 2 of PTT Group, the target was 35.5 million tons coming outside CO2 equivalent. And we, in fact, exceeded the target. The emission was 32.4 million tons covered outside equivalent. We have already set up PPT Group net zero task force to formulate the net zero policy for the whole group, and we will make a clear announcement on this by -- within the first half of this year to indicate the road map, whereby PTT Group will undertake to achieve net zero. PTT also worked together with public and private partners in order to define policies and mechanisms to support the reduction of emissions and to achieve net zero. We will together with the Ministry of Energy in order to draft the long-term strategies on greenhouse gas of Thailand, we work with the Ministry of Natural Resources and Environment, Forestry ministry, the Marine Resources and the Costal Resources and The National Park Department to draft a legal provision and mechanism to support carbon credit mechanism from the forestry sector. We also formed Thailand's Carbon Neutral Network to strengthen collaboration between public and private sector to reduce greenhouse gas emission. PTT also has been awarded the Sustainable Low Carbon Society Award from the Thailand Greenhouse Gas Management Organization. PTT also well together with its subsidiaries to developed lube container upcycling, a prototype project using use lube containers to make traffic cones and donated them to police -- the traffic police. On the social aspects, PTT has made contributions to support our society during the pandemic in many ways. Since the start of the outbreak, we have worked extensively, for example, providing support to field hospital and set up field hospitals around the country. We have recently launched Giving Breath Project to set up screening units and field hospital, end-to-end 100 green beds, 120 red beds donated so far. So all in all, our efforts to provide relief during the pandemic amounted to THB 9 billion altogether. In addition, we also support reforestation project. We set up 3 learning centers. The Urban Forest Park Learning Center, Sirinath Rajini Learning Center in order to disseminate knowledge about reforestation. In addition, we also planned urban forest park in Kung Bang in Bangkok -- in the vicinity of Bangkok. We also promote social investment through Social Enterprise Projects through Sarn Palung Social Enterprise Company Limited, Projects, for example, Cafe Amazon for Chance to create employment for disadvantaged groups such as people with hearing impairments and military veterans to increase income up to THB 7,000 per person per month. Another project, a Community Coffee Project to help farmers increase their income by THB 10,000 to THB 20,000 per household or Forest for Chance to expand for risk coverage in the country by employing the unemployed and local communities to grow the forest. And PTT Group has also accomplished its objective concerning lost time accidents and other occupational health and safety indicators. On the good governance side, we have transformed our business model and direct all the operations towards sustainability with investments in renewables and we have been assessed in terms of our good corporate governance and the excellent CG scoring for the 13 years running. And our Integrity and Transparency Assessment is also in a level with the total scoring of 94.2. Because of this, achievements, we continue to be selected as a member of the DJSI in Civil Class for the 10th running year. And we are also selected as the recipient of the S&P Global Sustainability Award in Civil Class. And we are also winning the Sustainability Award for 13 years running. And as a result of all these operations, we contribute and fully support all of the 17 SDG's. That's the operations as well as the ESG strategy is concerned for the sustainability of our organization as well as the country. May I start with global economic outlook. IMF forecast for GDP in 2022 to grow by about 4.4%, slightly down from 2021 except Japan, where growth will be higher from 1.6 to 3.3 and Thailand is forecast to grow higher from 1.6 to 4.1. Enabling factors include vaccination rates and more effective therapies resulting in less critical patient case. In any case, we have to monitor a quite a number of negative factors, including the Omicron as well as the persistent disparities in access to vaccinations and therapies. And these could risk variance and also continued supply-demand imbalances, furthering higher inflation, and we have to monitor the U.S. inflation control policy and leads mainly to tighter monetary situation. And China is still standing by its zero-COVID policy and therefore, locking down the country. And so these are factors to monitor. Now let's take a look at Thailand. Various institutes forecast growth, actual 2021, 1.6. Factors, positive factors include high vaccination coverage and the government's policy on learning to live with COVID-19 to boost consumption and ease pandemic-related measures, border reopening to allow international tourism, merchandise exports continuing to grow and easy monetary policy to support recovery. Even though inflation is higher, it remains within target. Negative factors, fiscal space is shrinking and heavier public debt burdens. These are limitations for recovery. And also it is forecasted that GDP is unlikely to return to pre-pandemic level until 2023. So those are global and Thai economic outlooks. Now let's take a look at petroleum and gas outlook. Petroleum and gas products this year are likely to be higher across all product categories, supported by higher demand and low inventories level. The key factors to monitor are the Russia-Ukraine tensions, how it is going to unfold. It will surely impact our price directly. Negative factors include continuing COVID-19 pandemic, OPEC+ position. They still stick together, and they will steadily increase production until September this year. And refinery maintenance season that will result in less demand for crude and U.S. supply that is likely to increase. Iran itself is expected to return to the same in the latter half of this year if the U.S. lifts sanctions. We have to monitor Iran, U.S. nuclear negotiation. So pricing outlook, Dubai should average in the range of 81 to 86. Actual 2021 at 69. Refined oil products will also increase along with oil price as well, resulting in Singapore GRM in the range of 5.4 to 6.4, whereas actual 2021 is at 3.4. Natural gas, LNG increase as well. Asian spot LNG should be in the range of 22.7. So those are petroleum prices. Let's take a look at Petrochem, olefins, aromatics, are expected to increase except PP compared to 2021 because of tight supply and seasonal maintenance from Q1 to Q2 and demand is likely to recover. Negative factors to watch would be pressure from new demand, olefins, aromatics from Northeast Asia and Southeast Asia, particularly China. Forecast HDPE up by 49% to 1,215 to 1,265. PP, slightly down, 0.8% down in the range of 1,290 to 1,340 this year. Benzene up by about 7.5% in the range of 960 to 1,010. PX, up by about 16% to 980 to 1,030. Now I would like to share PTT Group 2022 guidance. E&P sales volume this year is forecast to be 467 billion barrels per day, up 12%. Their unit cost will be 5% lower to the rate of $28 per barrel due to recognition of the whole year sale of Block H, Malaysia and acquisition of Block 61 in Oman. So these 2 production fields, production costs are low. Gas, natural gas demand will recover and gas demand is forecasted to increase, at average 3.5% and average gas price this year is likely to be higher by 30% to 50% against 2021 according to benchmark prices and more expensive LNG imports. Gas separation sale volume expected to be down according to capacity of GSP. U-rate is 82% to 87% compared to 2021's U-rate of about 90%. Oil OR domestic demand shall rise on the back of recovery, we will increase 186 more service stations, 129 in Thailand, 57 outside Thailand. Cafe Amazon at 506 stores, 380 in Thailand and the rest outside Thailand. P&R refinery is expected to recover. Singapore GRM, I already mentioned in the range of $5.4 to $6.4 per barrel. U-rate of PTT Group is in the range of 91% to 95% compared to last year, 95%. Petrochemical, higher demand from global economic recovery. But in any case, the proviso, we have to monitor new capacities whether they are as planned, to what extent. Power business, GPSC, domestic electricity consumption shall improve. New energy business be it Arun Plus, they set the target of EV charger at 1,350 units. OR aims at EV chargers of 200 inside PTT stations plus 150 outside PTT stations. In 2022, for EVME, EVME aims at producing 500 units of EV. Last year, they made about 200. The lease rate is 90%, which is deemed extremely successful new business, Arun Plus -- I'm sorry, Innobic shall recognize net income from Lotus in Q2. Gas pipeline, the 5th gas pipeline is expected to be completed end of this year, LNG receiving terminal, number two. Their capacity of 7.5 million ton per year. The first 2.5 million ton shall be completed in May or June. And the full 7.5 million ton capacity will happen in December this year, and therefore, increasing PTT Group's capacity to import LNG. FOXCONN JV, I mentioned already, FID in the first half of the year, if things go as planned, factory construction can start in the latter half of the COD in 2022 for the nonwoven fabric JV between IRPC and Innobic, capacity of 5.6 thousand ton. This can be COD in second Q this year. The high-quality circular plastic resin plant PET and HDP capacity, for the 5K ton per annum, this is expected to COD within first Q this year. Avaada that GPSC invested in India, their total capacity is 4,600 megawatts. That's -- GPSC portion is about 1,900 megawatt, already COD 2,200 and under construction, another 2,000 megawatts. This will reinforce the renewable share of 12 gigawatt within 2030 of PTT Group. Maintenance shutdown, I will not go into details, but such is the maintenance schedule from Q2, 3, 4, gradually, these different capacities shall shut down for their scheduled maintenance. So that's all for Q4 2021 performance. [Statements in English on this transcript were spoken by an interpreter present on the live call.]