THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
ENERGIZING SUSTAINABILITY
Sustainable Society
Sustainable E c o nomy
Sustainable Env ironment
VISION A leading fully integrated refining and 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 emphasize good Corporate Governance and commit to Corporate Social Responsibility
Investors can acquire company’s information from the annual disclose form (form 56-1) as show in www.sec.or.th or the company’s website at www.thaioilgroup.com.
CONTENT 002
Financial Highlights
074
Management Organization
004
Message from the Board of Directors
076
Management Team
014
Audit Committee Report
080
016
Nomination and Remuneration Committee Report
Assets and Shareholders Information and Management Structure
098
Risk Factors and Corporate Risk Management
018
Corporate Governance Committee Report
102
Internal Controls
020
Risk Management Committee Report
104
Corporate Governance Report
133
Thaioil Group’s Social Responsibility
022
Thaioil Group’s Vision, Mission, and Operating Strategies
023
Summary of Business Achievements in 2014
134
Corporate Information
028
Milestones of 2014
142
Thaioil Group Business Structure
032
Market Review 2014 and Industry Outlook
144
Revenue Structure
044
Production Process and Process Development / Quality, Security, Safety, Health, and Environmental Management
146
054
Future Projects
150
058
Organizational Effectiveness Management
156
060
Board of Directors
157
Management’s Discussion and Analysis of Financial Position and Operating Results
Connected Transactions
Board of Directors’ Responsibility for Financial Reporting
Financial Statement
002
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l Hi g hl i g ht s
01
ANNUAL REPORT 2014
FINANCIAL HIGHLIGHTS TOTAL ASSETS
147,148
154,568
170,676 208,662
192,802
2010
2011
318,391
446,241
2010
2011
2012
2013
2014
75,570
85,034
90,724
94,981
87,039
2010
2011
2012
2013
2014
8,956
14,853
12,320
9,316
(4,026)
2010 2
2011
2012
2013
Million Baht
SALES REVENUE
2012
2013
447,432 414,575
2014 4
390,090
Million Baht
TOTA L EQUITY Million Baht
NET PROFIT / (LOSS) Million Baht
2014
003
THAI OIL PUBLIC COMPANY LIMITED
Fi n an cial Highlights
ANNUAL REPORT 2014
2013 (1)
2014
2012
2011 (2)
2010 (3)
O PE R AT I NG Sales Revenue
Million Baht
390,090
414,575
447,432
446,241
3 18 ,3 9 1
EBITDA
”
2,651
22,337
20,350
28,760
17 ,3 8 1
Net Profit / (Loss)
”
(4,026)
9,316
12,320
14,853
8 ,9 5 6
Earnings / (Loss)
Baht/Share
(1.97)
4.57
6.04
7.28
4 .3 9
Million Baht
192,802
208,662
170,676
154,568
1 47 ,1 4 8
Total Liabilities
”
105,763
113,681
79,952
69,534
7 1 ,5 7 8
Total Equity
”
87,039
94,981
90,724
85,034
7 5 ,5 7 0
Times
0.7
5.9
8.7
13.5
9 .7
Current Ratio
”
2.7
2.6
2.9
3.1
2 .7
Net Debt to Equity Ratio
”
0.4
0.3
0.2
0.3
0 .4
(4.6)
10.4
14.8
19.7
1 3 .0
(2.0)
4.9
7.6
9.9
6 .3
per Share
FI N A N C I A L Total Assets
FI N A N C I A L R AT I OS Interest Coverage Ratio
Return on Equity Return on Assets
Percent ”
S TO C K DATA Annual average : Daily closing stock price
Baht/Share
50.40
64.60
65.10
69.80
4 9 .9 0
Market Capitalization
Million Baht
1 02,817
131,786
132,806
142,394
1 59 ,6 3 2
Dividend Payment
Baht/Share
1.16
Dividend Yield
(5)
Book Value
Percent Baht/Share
(4)
2.30
2.70
3.30
2 .0 0
2.3
3.6
4.1
4.7
4 .0
40.54
44.57
42.42
38.96
3 5 .0 1
Notes: (1) The 2013 financial statement was restated, as Thaioil Group adopted Thai Financial Reporting Interpretations Committee 4 (TFRIC 4) on determining whether an arrangement contains a lease. (2) The statement of financial position as at December 31, 2011 have been reclassified to conform to the presentation in the 2012 financial statements. (3) The Group adopted TAS 19-Employee Benefits retrospectively (4) Including the interim dividend for 2014 half-year results at the rate of Baht 0.56 per share which was paid on September 26, 2014, and the remaining dividend 0.60 Baht per share is to be proposed to the 2015 Annual General Meeting of Shareholders’ approval. (5) Calculated from the Annual average : Daily closing stock price.
004
THAI OIL PUBLIC COMPANY LIMITED
M es s a g e fro m t he B o a r d o f D ir e c to r s
ANNUAL REPORT 2014
MESSAGE FROM THE BOARD OF DIRECTORS
02
Mr. Kurujit Nakornthap
Mr. Atikom Terbsiri
Chairman of the Board Thai Oil Public Company Limited
Chief Executive Officer and President Thai Oil Public Company Limited
To the Shareholders Focusing on balanced economic, social, and environmental
certification for the second year in a row speaks volumes for our
development under good gover nance to fairly address
business success under such direction. In addition, Thaioil
stakeholders’ needs, the Board of Directors has defined a
is rated as a world oil and gas sustainability leader, an integral
business management policy and goals to drive Thaioil Group
part of our worldwide successes and accolades earned this
with quality toward sustainable growth to in turn support national
year. For more detail, please refer to this annual report. Above
energy security.
all, they illustrate the commitment, devotion, and unity of the
Since DJSI (Dow Jones Sustainability Indices) is universally
Board, the management, and all employees to drive toward
recognized for sustainability assessment, our DJSI membership
greater success.
005
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
Me ssage from t h e Board of Directors
The year was marked by high volatility in the world crude oil price,
posted good progress against plans, including the SPP Project,
with Dubai swinging wildly between USD 55 -111 per barrel.
LAB (Linear Alkyl Benzene) Project to add value to products,
Accounting for this were several factors, led by concerns over
and business expansion to the ASEAN market. These projects
China’s economic slowdown, Quantitative Easing (QE) measures
will play a key role in supporting Thaioil’s business security
of the US, the unrest and political conflicts in the Middle East
achieved through diverse industries and high-potential market
and Ukraine, and the crude supply glut in and outside OPEC,
expansion (domestic and regional).
particularly shale oil production by the US. Equally important, In tandem with our business goals, the Board values business OPEC’s decision to maintain member countries’ crude oil outputs conduct with due regard for safety and the environment; our in November sent the average Dubai crude oil price as at December safety records have been continually improving each year. 2014, tumbling from last year’s average of USD 108 to only Our projects are to conserve energy and the environment, and USD 60 per barrel. These external, uncontrollable factors result to contribute to society, especially the community around the in Baht 16,890 million of stock loss. refinery in Sriracha District, Chonburi Province, where Thaioil Group’s The Board and the management are well aware of these
Health and Learning Center for Communities, together with the
unfavorable and challenging circumstances of the oil and
community itself, promote activities covering education, health,
aromatics businesses, aggravated by the sluggish demand and
and tradition. Engineering and energy expertise and years
economy. These prompted us to issue several measures to
of experience of our personnel have been applied to the
ease business impacts, including acceleration of major planned
development of remote communities without access to the
turnaround tasks, suitable risk management of inventories
national public utility system. One notable example is our project
(in price and volume), identification of opportunities for product
on biogas from rubber production and household waste and
price hedging, and the finetuning of refining and other processes
promoting toxin-free home-grown vegetation at Mak Noi Island,
to raise revenue and cut costs. Such measures contributed to
Phang-Nga Province. Another is the hydropower plant project in
satisfactory operating profits (exclusive of stock loss) totaling
Mae Jo community, Chiang Mai Province. Part of these projects’
Baht 12,864 Million. If the stock loss is incorporated as part of
success stems from the collaboration of our volunteers filled
the accounting standard, however, the Company posts Baht
with awareness of sharing and giving back to society.
4,026 Million in total loss for the year. The Board truly wishes and is ready to support the management to Despite the frail industry and economy, Thaioil managed to
drive and steer Thaioil to become a regional leading organization
leverage its strength in cost management to drive strategic
as well as a national economic driver to enhance energy security,
projects and lay a strong foundation for future businesses, cope
in parallel with decent returns generated for shareholders and
with fluctuating product prices, and hone competitiveness.
fair treatment of all stakeholders under good governance and
Several projects have been wrapped up and commercialized
social responsibility. For all your trust in and support to our
this year, including the energy efficiency improvement project
overall business over the years, the Board of Directors wish
at Crude Distillation Unit - 3 (CDU-3) and High Vacuum Unit - 2
to express its sincere appreciation to shareholders, investors,
(HVU-2), solvent capacity expansion of Sak Chaisidhi, and crew
customers, business partners, financial institutions, and public
boat fleet expansion of Thaioil Marine. All ongoing projects have
organizations and agencies alike.
006 TOP E nerg y Indus t r y G r o u p L e a d e r in S u s ta in a b ility
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
THAI OIL P U B L I C C O M PA N Y LIMITED
3,395 listed companies worldwide of various industry groups were invited to participate in DJSI sustainability assessment
007
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
T OP E n e rgy In d u st r y Grou p Le ad e r i n Sus tainability
ENERGY INDUSTRY GROUP LEADER IN SUSTAINABILITY The 2014 marked the second consecutive year in which Thai Oil Public Company Limited has earned recognition as a Dow Jones Sustainability Indices Member assessed as Energy Industry Group Leader from 209 companies worldwide. Besides, RobecoSAM, the globally accepted sustainability assessor, has recently announced Thai Oil Public Company Limited as the Oil and Gas Industry Leader with Gold Class Distinction in its sustainability yearbook. Thaioil’s commitment to sustainable business is illustrated by its management of risks concerning the environment, society, and good governance under a five-year sustainability master plan. The implementation of Operational Excellence is to ensure efficient business. Sustainability activities, as disclosed in the Sustainability Report under GRI G4 framework, are aimed to respond to all stakeholders’ expectations.
008
THAI OIL PUBLIC COMPANY LIMITED
Su s t a i na bl e E co no my
ANNUAL REPORT 2014
S U S TA I N A B L E ECONOMY
R e n e wa bl e E n e r g y Bu si n e s s E t h a n o l p ro d u c t io n fro m s u g a rc a n e , m o la s s e s and cassava.
L u be Ba se O i l Bu si n e s s
Tr a n s p o r t a t i o n a n d O t h e r Bu si n e s s M a r in e a n d p ip e lin e t r a n s p o r t a t io n o f c r u d e o il a n d p e t ro le u m / p e t ro c h e m ic a l p ro d u c t .
Oil Refiner y Largest refiner y in Th a i l a n d acco unt ing for 25% of nat ional refining c a pa c i t y. The product s i n c l u de LPG, Ga sol i n e , Jet Fuel, Ke rose n e , Gas Oil, Fuel O i l , e t c .
Powe r G e n e r a t i o n Bu s i n e s s Po w e r a n d s t e a m p ro d u c t io n a n d d is t r ib u t io n .
Pro d u c t io n o f lu b e b a s e o il as t h e k e y c o m p o n e n t o f lu b r icant, a n d lo w - t o x ic it y Tre a t e d Dis tillates Aro m a t ic E x t r a c t ( T DAE ) - r aw m a t e r ia l f o r t y re in d u s t r y with b it u m e n a s b y - p ro d u c t .
009
THAI OIL PUBLIC COMPANY LIMITED
Su st ai n able Economy
ANNUAL REPORT 2014
Petro c h emic al B usin ess Arom a t i c produ c t i on w h i c h i s a r aw m a t e ri a l of pol ye st e r and P E T pl a st i c . Th e produ c t i on of LAB - a su rf a c t a n t f or det e rge n t produ c t i on .
Sustainable Economy S o lven t Bu sin e s s M a n u fa c t u re r a n d di st ri bu t or of sol ve n t w h i c h i s a c om pon e n t of pa i n t i n g i n du st r y.
Thaioil Group focuses on economic growth a c h i e v e d t h ro u g h r i s k a n d i n v e s t m e n t management by taking into consideration the sustainability factor throughout the product supply chain in order to maximize profitability under good corporate governance practice.
010
THAI OIL PUBLIC COMPANY LIMITED
Su s t a i na bl e S o ci et y
ANNUAL REPORT 2014
S U S TA I N A B L E SOCIETY
CSR for Commu n ities s u r r oundi ng the Refin er y
T h a i o i l G ro u p’s H e a lt h a n d L e a r n i n g C e n t r e fo r C o m mu n i t i e s
011
THAI OIL PUBLIC COMPANY LIMITED
Su st ai nable Society
ANNUAL REPORT 2014
CS R fo r So c iety A ppl y k n ow l e dge a n d e xpe ri e n c e s on e n e rgy t o de ve l op qu a l i t y of l i f e i n t h e re m ot e a re a s.
Sustainable Society Responsibility for Society and Communities As Asia’s leading energy producer, Thaioil Group strives to achieve sustainable growth in parallel with the nurturing of confidence, acceptance, and trust on the part of communities and society. To this end, the Group earnestly pays attention to the environment and safety of communities, prepared to aid society on the basis of the mutual growth concept among industries, communities, and the environment. Communities and Thaioil Group, Together We Develop Sustainable Society. Focusing on improving the quality of lives, both in our vicinity community and in society at large, the Group promotes hygiene, develops education, builds community members’ capacities, develops renewable/alternative energy from local resources efficiently so as to extend energy opportunities to remote communities, creates mutual development and learning processes among communities, partners, and Thaioil Group, and values the cultivation of public service awareness among employees.
012 Su s t a i na bl e E nv i ro nm e n t
S U S TA I N A B L E ENVIRONMENT
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
013 Su st ai n ab l e Environment
Sustainable Environment Thaioil Group is fully awared of the impact on natural resources and so initiate several environmental measures through efficiency improvement of production processes. Through product quality improvement, the Group strives to ease environmental impacts and enhance future business competitiveness.
014
THAI OIL PUBLIC COMPANY LIMITED
Au di t C o mm i t t ee R epor t
03
ANNUAL REPORT 2014
AUDIT COMMITTEE REPORT
Mr. Chulasingh Vasantasingh ntasingh Chairman of the Audit Committee Thai Oil Public Company ny Limited
1. Financial Statements: The committee reviewed material 1 items of quarterly and annual financial statements for the it Company and its subsidiaries, about which clarification was C given by the external auditor and senior management. It found g tthat Thaioil had prepared its financial reports accurately, comprehensively, and credibly. The financial statements c contained adequate disclosure of information for investors c and users. Account recording conformed to IFRS, which was a tthe external auditor’s unqualified view. At its meeting with the external auditor in the absence of the management,
To the Shareholders
material data and audit-related internal control, the financial statements, and major obstacles faced during the audit were
The Audit Committee is made up of knowledgeable independent
discussed. No material observation was filed by the external
directors with pertinent experience in accounting, finance,
auditor. Assessment of the internal control system found that
economics, law, and the petroleum, petrochemical, and energy
it was suitable, with no data concealment.
businesses. These members are qualified to review the credibility of financial statements against the requirements
2. Connected Transactions: In reviewing connected
of the Office of the Securities and Exchange Commission
transactions or those potentially posing conflicts of interest
(SEC) and the Stock Exchange of Thailand (SET). The present
under the SET and SEC’S announcement, the committee
committee is chaired by Mr. Chulasingh Vasantasingh, with
concluded that Thaioil had observed regular business
two independent directors, namely Ms. Chularat Suteethorn
practices, exercised fairness and sensibility, and produced
and Mr. Suvit Maesincee, as members.
no siphoning of benefits. Further, optimal considerations were given to the Company’s business conduct for itself and its
The committee undertook its Board-assigned duties under
shareholders. The committee also reviewed such information
its own charter, which aligned with the requirements and
disclosure for accuracy and completeness.
good practices of SEC and SET. This year it held 12 meetings, including consultations held with the management, the
3. Risk Management: To ensure Thaioil’s suitably effective
internal auditor, and the external auditor as applicable to
risk management system, the committee reviewed risk
each. At one meeting the committee met separately with the
management processes for continued efficiency improvement,
external auditor in the absence of the management. Below
regarded as an element of corporate governance. It was
is a summary of its performance this year:
found that the Company had restructured its risk management into three aspects: strategy and investment project, operation, and business continuity management. Such
015
THAI OIL PUBLIC COMPANY LIMITED
A u d i t Com mittee Report
ANNUAL REPORT 2014
restructuring raises the efficiency of risk management to
7. Appointment of the External Auditor for 2015: In selecting
encompass all aspects and respond to dynamic external
the external auditor, the committee nominated the auditor
changes that affected business, while aligning with the
team based on independence, skills, competence, and
Company’s short-term and long-term goals and strategic
experience in energy-business audits, as well as audit’s fee.
plans, leading to value supplementation and sustainable
The committee therefore advised the Board to seek approval
growth for Thaioil Group. To this end, awareness is promoted
from the shareholders’ meeting to nominated KPMG
of risks, as is risk management process development so that
Phoomchai Audit Ltd., with Mr. W inid Silamongkol,
the processes suit prevailing settings and circumstances.
CPA registration No. 3378, or Mr. Charoen Phosamritlert,
Additionally, IT system is introduced to support risk management
CPA registration No. 4068, or Mr. Vairoj Jindamaneepitak,
practices across Thaioil Group.
CPA registration No. 3565, or Mr. Waiyawat Kosamarnchaiyakij, CPA registration No. 6333 as the 2015’s external auditor
4. Internal Controls: The committee reviewed Thaioil Group’s
team. The proposed audit fees amounted to Baht 2.54 million.
internal control system for the year to become reasonably confident in the Company’s efficient and effective business,
In summary, the Audit Committee concluded that this year,
and in the achievement of the defined objectives and goals.
Thai Oil Plc. had valued efficient and effective business
To this end, the Company established internal control by
conduct and prepared material, credible financial statements
assigning the management to undertake internal control
in line with generally accepted accounting principles, complete
assessment using the system adequacy checklist of The
with adequate disclosure of connected transactions with
Committee of Sponsoring Organizations of the Treadway
potential conflicts of interest; that it commanded good
Commission (COSO). The Company found that its good
corporate governance, adequate risk management, and a
internal control system adequately suited its businesses,
suitable, watertight internal control system; and that it had
leading to efficient and effective job performance. The view
fully complied with all relevant legislation and regulations
was endorsed by the committee and the Board.
for its businesses.
5. Internal Audit Supervision: By having Internal System Audit report directly to it, the committee ensured that the unit carried out its work freely. The committee reviewed and approved the annual internal audit plans, supervised audit
February 12, 2015
work against plans, mentored the unit, and assessed the
On behalf of the Audit Committee
annual performance of the head of Internal System Audit.
6. Compliance with the Law: The committee reviewed that the Company strictly comply with legislation related to securities and exchange, SEC and SET regulations, and
(Mr. Chulasingh Vasantasingh)
relevant laws. The committee found that the Company
Chairman of the Audit Committee
complied with all relevant regulations as listed above.
Thai Oil Public Company Limited
016
THAI OIL PUBLIC COMPANY LIMITED
N o m i na t i o n a nd R emu n e r a tio n C o m m itte e R e p o r t
04
ANNUAL REPORT 2014
NOMINATION AND REMUNERATION COMMITTEE REPORT
Gen. Jiradej Mokkhasmit mit Chairman of the Nomination tion and
The present Nomination and Remuneration Th Committee consists of Co
Remuneration Committee e Thai Oil Public Company Limited
1. Gen. Jiradej Mokkhasmit
Chairman of the Nomination and Remuneration Committee (Independent Director)
2. Mr. Thaworn Phanichaphan
Member of the Nomination and Remuneration Committee (Independent Director)
To the Shareholders
3. Mr. Nuttachat Charuchinda
Member of the Nomination and
In line with the corporate governance guidelines for listed
Remuneration Committee
companies, the Board of Directors appointed the Nomination and Remuneration Committee and approved its charter to
4. Mr. Thosaporn Sirisumphand Member of the Nomination and
frame its duties and clearly define its composition and
Remuneration Committee
qualifications. The committee consists of at least three
(Independent Director)
directors, most of whom must be independent and none of whom is to be the Chairman of the Board or the
Meetings and Performance in 2014
Chief Executive Officer and President (CEO/President). Performing all the duties spelled out in its charter, Members must be knowledgeable and experienced, must the committee met five times with 100 percent attendance, understand the qualifications, duties, and responsibilities,
as shown on page 89-90.
and must devote adequate time to the fulfillment of the committee’s duties.
Observing its charter, the committee deliberates recruitment criteria, approaches, and processes and defines suitable remuneration for the Board and its committees for the
A summary of these meetings appears below: 1. For the CEO/President, assessed his performance and decided his salary raise, commensurate with his performance against the job’s criteria.
consideration of the Board, which tables them to shareholders’
2. Recruited and shortlisted people for the Board’s
meetings for approval every year. The CEO/President’s
c o n s i d e r a t i o n b e f o re t a b l i n g t h e i r n a m e s t o t h e
remuneration, also deliberated by this committee, is proposed
shareholders’ meeting for approval to replace the
for approval by the Board.
directors who complete their term in 2014.
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
3. Based the Board’s remuneration for 2014 on criteria suiting their responsibilities and linked this remuneration to Thaioil’s overall performance against peer listed companies, as well as its dividend payment. 4. Recruited and shortlisted qualified people to the Board for appointment in place of the directors who resigned before completing their terms. 5. Recruited and shortlisted those qualified from within and outside Thaioil for the Board’s appointment as the new CEO/President. 6. Recruited and shortlisted directors for seats on this committee, the Audit Committee, Corporate Governance Committee, and Risk Management Committee for the Board’s appointment to vacated posts due to resignation/term completion, or additional appointment. 7. Encouraged Thaioil to allow minor shareholders to propose agenda items and nominate directors for election at least three months ahead of the 2015 AGM from the period of September 25 to December 31, 2014, through Thaioil’s website.
January 15, 2015 On behalf of the Nomination and Remuneration Committee
(Gen. Jiradej Mokkhasmit) Chairman of the Nomination and Remuneration Committee Thai Oil Public Company Limited
017 N om i n at i on an d Re m u n e rat i on Com mittee Report
018
THAI OIL PUBLIC COMPANY LIMITED
Co rpo ra t e Go v erna nce C o m m itte e R e p o r t
05
ANNUAL REPORT 2014
CORPORATE GOVERNANCE COMMITTEE REPORT
Adjunct Professor
1. Endorsed a self-assessment form for anti-corruption
Dr. Thosaporn Sirisumphand phand
measures and reference evidence for use in applying for me
Chairman of the
a m membership certificate of the Thailand’s Private Sector
Corporate Governance Committee Thai Oil Public Company Limited
Collective Action Coalition Against Corruption (CAC). Co Thaioil secured this certificate in April 2014. Tha 2. Endorsed a revised draft of the CG and Code of Conduct Manual, featuring criteria and guidelines conforming Ma to tthe prevailing CG standard, including Good Governance Principles for Listed Companies (issued by the Stock Pri Exchange of Thailand, SET), assessment criteria for listed
To the Shareholders
companies’ CG Report (issued by IOD), and Dow Jones Sustainability Indices (DJSI) assessment.
To turn Thaioil into a sustainable organization, adherence to corporate governance (CG) represents one of Thaioil’s policy items and missions, a point valued and committed
3. Endorsed practical guidelines on Board meetings to deliberate agenda items where directors have vested interests and guidelines for handling confidential agenda items.
to by the Board of Directors, executives, and all employees over the years. To this end, the Board appointed the
4. Endorsed criteria for executives and employees invited
C o r p o r a t e G o v e r n a n c e C o m m i t t e e , w h i c h c u r re n t l y
to serve in other companies, units, or entities, particularly
consists of Adjunct Professor Dr. Thosaporn Sirisumphand
the CEO/President, executives, and employees.
(as Chairman), Mr. Yongyut Jantararotai, and Mr. Praipol Koomsup. This committee is assigned by the Board to define CG policies and guidelines, set business ethics
5. Endorsed the amended performance assessment forms for the Board for 2014. Specifically, the Board and Board-Committee assessment forms were made clearer
standards, and monitor business conduct, while ensuring
and covered the performances of the Board-Committees
that Thaioil’s business is based on good governance
as well as the responsibilities spelled out in their respective
principles. It also advocates and mentors on third-party
charters. Finally, the committee endorsed Thaioil’s disclosed
assessment of CG standards to promote international
assessment outcomes of the four Board-Committees in the
acceptance, while advocating and promoting extensive
annual report.
adoption of business values under CG principles among all executives and employees to turn such values into a corporate culture.
6. Approved CG activity plans for 2015 to enable the Company’s business to conform to CG principles and internationalize CG practices; promote confidence among
This year, the committee held five meetings and fulfilled all
shareholders and stakeholders; and stimulate and cultivate
its charter-defined duties by approving and endorsing key
values among all employees for their strict conformance to
CG activities and plans summarized below:
CG and business ethics.
019
THAI OIL PUBLIC COMPANY LIMITED
Corp orat e Gove rn an c e Com mittee Report
ANNUAL REPORT 2014
This year, Thaioil executed the action plans endorsed by this
Domestic Recognition
committee by staging activities to stimulate and underscore
>> Membership certificate under CAC (Private Sector
CG awareness and the code of business conduct among all, while running assorted projects covering all its stakeholders so as to elevate its CG standard. A case in point is the development of the Thaioil Group Suppliers Code of Conduct
Collective Action Coalition Against Corruption).
>> SET Award of Honor for CG and Corporate Social Responsibility with continued excellence (2012-2014), at the SET Awards 2014 event, hosted by SET.
to promote a common understanding among Thaioil Group and its business partners of business conduct on the basis
>> “Excellent” Corporate Governance Report of Thai Listed
of sustainability, which is communicated to business partners
Companies 2014 Award, which is the ultimate award, for
through various channels. This committee, executives,
the sixth straight year, presented by Thai IOD.
and employees also participated in the PTT Group CG Day 2014 activities staged by PTT Group companies to not only drum up awareness of CG’s importance and
>> Recognition for outstanding achievements on social development (CSR entity of excellence), presented by the Ministry of Social Development and Human Security.
benefits, but also promote creative cooperation in PTT Group’s campaign against corruption.
>> One of 19 Thai listed companies to undergo assessment for outstanding corporate governance practices under
Thaioil’s commitment to CG and earnest intention, has earned
the ASEAN CG Scorecard criteria.
acceptance from various entities, institutes, companies, and agencies worldwide this year.
These accolades speak volumes of not only Thaioil’s standard for CG and ethics, but also its coordination, development,
International Acceptance
and promotion to upgrade business conduct under CG on
>> World-class acceptance due to the DJSI membership in
the part of the Board, executives, and employees in tandem
2014 for the second consecutive year with a maximum
with responsibility to society and the environment. These
score, recognized as the Energy Industry Group Leader.
essential factors have convinced the Corporate Governance
>> The Strongest Adherence to CG Award at the 4 th Annual
Committee that Thaioil will achieve its business goals and
Southeast Asia Institutional Investor Corporate Award event for 2014, based on a survey of investors and analysts of leading Southeast Asian companies conducted
grow with quality, which will benefit shareholders, stakeholders, society, and the nation. Ultimately, Thaioil is bound to become a sustainable entity.
by Alpha Southeast Asia, a leading publication on international finance and investment.
January 8, 2015 On behalf of the Corporate Governance Committee
>> The Assets Excellence in Management and Corporate Gover nance Awards 2014 (Platinum Level) award, presented by The Assets, Asia’s leading finance journal.
>> Asia’s Outstanding Company on Corporate Governance Award, in its second consecutive year, under the Corporate
(Adjunct Professor Dr. Thosaporn Sirisumphand)
Governance Asia Recognition Awards 2014 Project,
Chairman of the Corporate Governance Committee
presented by the Corporate Governance Asia journal.
Thai Oil Public Company Limited
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RISK MANAGEMENT COMMITTEE REPORT
Mr. Apisak Tantivorawong ng
Performance in 2014
Chairman of the
As defined in its charter, the committee defined and reviewed
Risk Management Committee ittee Thai Oil Public Company Limited
the corporate risk management framework, policies, and processes. It also provided guidance to the risk management approach in line with Thaioil’s business direction, operating strategies, and plans, while supporting continuous, efficient development of internationally accepted risk management throughout Thaioil to form a corporate culture. This year, the committee met 10 times, with the following summary of actions:
To the Shareholders
1. Acknowledged and endorsed for the Board’s consideration
The Board of Directors of Thai Oil Public Company Limited appointed the Risk Management Committee to steer corporate risk management and fulfill the Company’s goal achievement, fostering confidence and credibility among investors and stakeholders. The current committee consists of three members who are competent and experienced in this business:
the assessment outcomes of Thaioil Group’s risk management processes for 2013 by consultant Ernst & Young, together with the Group’s corporate risks and risk management plans for 2014, its Business Continuity Management (BCM) and risk management committee report for 2014, and the risk management plan for 2015. 2. Acknowledged and endorsed for the Board’s consideration the assessment outcomes and business impacts resulting
1. Mr. Apisak Tantivorawong Chairman of the Risk Management Committee
from new ideas on energy reform and the World Economic Forum’s Global Risks 2014.
(Independent Director) 2. Mr. Twarath Sutabutr
Member of the Risk Management Committee (Director)
3. Endorsed for the Board’s consideration the amendment and addition of the framework for product and crude oil price risk management; amendment to target prices concerning spread risk management for product and
3. Mr. Atikom Terbsiri
Member of the
crude oil prices for 2015 and 2015-2016; the strategic
Risk Management Committee
framework for risk management for product and crude
(Director /
oil prices and guidelines for risk management for inventory
Chief Executive Officer
crude oil as of December 2014 to accommodate the
and President)
volatile crude oil price and product spreads.
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
4. Endorsed for the Board’s consideration risk management plans for key investment projects of the Group. 5. Endorsed for the Board’s consideration risk aspects of issuing and offering domestic Baht-denominated debentures and fund ceiling expansion for intercompany loans to affiliates. 6. Acknowledged and provided recommendations on operating plans, investment plans, and risk management of affiliates. 7. Provided recommendations to promote the development of corporate risk management for greater efficiency and effectiveness. On the whole, the Risk Management Committee considers that, for the past year, the Company has developed its corporate risk management practices to cover all risk factors, with continued risk management in line with evolving circumstances. The committee held regular meetings, with timely special meetings held to review key, urgent risks, leading to effective risk management for the Group. The Company has efficiently and suitably managed key corporate risks, while keeping them manageable.
January 23, 2015 On behalf of the Risk Management Committee
(Mr. Apisak Tantivorawong) Chairman of the Risk Management Committee Thai Oil Public Company Limited
021 Ri sk Man age m e n t Com mittee Report
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THAIOIL GROUP’S VISION, MISSION, AND OPERATING STRATEGIES
Thaioil Group aspires to become a business
Being a strategy-focused organization, Thaioil Group is characterized
leader in the integrated refining and
by a regular review of vision and business directions to further its
petrochemical company in Asia-Pacific
business capability and promote competitiveness, while carving
with the following missions:
business growth and preparedness for emerging challenges and increasingly intense competition. The group has defined three
01 To be in top quar tile on performance and return on investment
key strategies for growth:
1. Operational Excellence for TOP Profit Enhancement : Focus on process reliability, production planning efficiency, and qualified production process and distribution flexibility, to meet customer needs and ensure the competitiveness with reasonable operating costs in order to secure the Company’s position as ‘the Most Reliable Company’
02 To become a high-performance organization that promotes teamwor k, innovation and tr ust for sustainability
2. Growth Execution : Focus on the investment that enhances the Company expertise to ensure the operating efficiency, increase the advantage in the market, and expand the Company’s business areas. Aiming at expanding to the overseas industrial market, the value-adding and market-expanding abroad: especially Indonesia, Vietnam, and Myanmar, have been undergone, thus boosting Thaioil Group’s performance and potential in long term
03 To emphasize good Corporate Governance and commit to Corporate Social Responsibility.
3. Business Excellence & Sustainability : Focus on bolstering corporate preparedness and grooming personnel’s skills and competency to accomplish corporate success while accommodating business growth abroad and emerging businesses based on sustainability framework
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SUMMARY OF BUSINESS ACHIEVEMENTS IN 2014
BUSINESS DEVELOPMENT BASED ON SUSTAINABILITY Thaioil Group operates on the basis of management system development with a focus on excellence and efficiency in economic, environmental and social aspects, in line with requirements and safety together with systematic risk management for sustainable growth. This has bolstered confidence among business partners, and created the safety surroundings around neighbor community, resulting in the selection to the DJSI Membership in the Emerging Markets, and the recognition from RobecoSAM as a Gold Class and Industry Leader in the Oil & Gas business group; both for the second year in a row.
1. Becoming a Sustainable Energy Leader through
The year marked another great pride for the group, selected
the qualification to Dow Jones Sustainability
to the DJSI Membership in the Emerging Markets for the
Indices (DJSI) membership in the Emerging
second year in a row, marked by a top score in the world
Markets group for 2014 for the second year in
energy industry group. Such was a proof of its business
a row with the top score in the world energy
caliber, evident in management system development with a
industry group
focus on excellence and efficiency in economic, environmental,
Facing the challenging, stagnant world economy and the
and social aspects in line with requirements and safety
plunging world oil price, Thaioil Group leveraged the
together with systematic risk management for sustainable
experience and skills of the last half-century in the energy
growth. This international recognition has bolstered confidence
business to maintain its production excellence and operating
in the group among business partners, investors, and financial
efficiency under a world-class governance standard in
institutions.
parallel with a desire to look after the environment and all its stakeholders.
In addition, Thaioil has secured recognition from RobecoSAM (DJSI’s assessor of sustainability) as a Gold Class and Industry Leader in the Oil & Gas business group; the only Company receiving this recognition 2 years in a row.
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2. Management and business successes amid
of domestic and regional refineries. Above all, Thaioil Group
volatile crude oil prices and heated competition
remained Thailand’s major fuel producer, with a 31% proportion
in the petroleum, aromatics, and lubricant
of domestic sales volumes of total petroleum demand.
businesses
These factors resulted in the overall performance outcomes
This year, Thaioil Group maintained its focus on the operational
(exclusive of oil stock loss) meeting goals.
excellence and customer needs. This was achieved through active risk management to accommodate volatile
3. Production excellence arising from integrated
economic conditions and crude prices, which fell by
management
USD 40 per barrel during the latter half of the year due to
In striving for operational excellence, Thaioil Group remains
world supply gluts, notably brought on by shale oil and shale
committed to group integration among the refining, aromatics,
gas production by the US, resulting in crude oil stock loss.
and lubricant businesses, which means planning exercises
Meanwhile, the petroleum and petrochemical markets were
among all units for efficiency, reliability, and flexibility in
pressured by new market players, causing lower spreads
meeting market needs. As a result, the group’s petroleum
between products and feedstock. The above - mentioned
products and petrochemical feedstock commanded higher
factors sent the group’s accounting gross integrated margin
prices and quality than those of basic refineries.
to USD 1.9 per barrel. Margin improvement remained the group’s key strategy. Still, the group managed to ease impacts of the stock loss
This year, its gross margin rose to about USD 0.57 per barrel,
with its commitment to operational excellence and the year’s
most of which is a result of unconventional-crude refining
milestone achievement—a major maintenance turnaround—in
based on a greater variety of crude oil. This benefit arose from
which the group’s collaboration lowered the turnaround
HVU-2 debottlenecking and energy efficiency improvement
time from 55 to 46 days, apart from its customer focus and
at CDU-3. The rise in margin was also attributable from a
efficient price risk management. As a result, the group’s
shorter turnaround period, production efficiency improvement,
refinery utilization rose to 98%, which exceeded the average
and sale of products of customers’ desired quality, including
OPERATIONAL EXCELLENCE
Amidst volatile crude oil price and heated competition, Thaioil Group is determined to maintain the operational excellence with high efficiency, strong reliability, and full flexibility to meet market needs and to strive in the dynamic market situations. This continually secures Thaioil’s position as Thailand’s major fuel producer with the ability to increase its margin improvement.
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the import of long residue from new sources, which
As for risk management, the group’s heightened corporate
accounted for higher outputs of lube base oil, and finally the
risk management covers strategic, operational, and BCM
higher TDAE output. All these result in Thaioil Group being
(Business Continuity Management) risks. It expanded
singled out among the world’s leading refineries, based on
supervision systematically, based on operation framework,
operational availability, steadily improving energy intensity
to group affiliates to raise operating efficiency and
index, and cost control for competitiveness.
accommodate international-venture uncertainties such as
The Company continued to cultivate safety as a core business value among all employees, evident in an excellent safety statistics with the total recordable case frequency in the top 10 quartile among the oil & gas industry for the eighth
crude price volatility, natural catastrophes, and terrorism. This year’s oil price hedging and cross-currency swap successes—designed to minimize volatility of the oil price and exchange rate—yielded about Baht 2.5 billion.
straight year, according to The International Association of Oil & Gas Producers (IOGP).
5. Project success and constant implementation of strategic plans
To maximize its capability, the group also collaborated with other PTT Group companies to acquire group management and administration, including consultative meetings on business outlooks and prices and the Operational Excellence Project; all of which are commercial - based collaboration.
Thaioil Group remains a strategy-focused organization with continual revision of its strategies. This year saw market volatility and increasingly fierce competition, necessitating clear strategic revision to swiftly address dynamic business factors and achieve leadership in regional refining and
4. Proactive marketing and risk management
p e t ro c h e m i c a l b u s i n e s s e s , w h e t h e r i n p e r f o r m a n c e
strategies
outcomes, in business growth, or in long-term sustainability.
Thaioil Group values the management of marketing strategies; the key success is to keep good relations with customers, both domestic and abroad. High quality products, punctual delivery, diversity of products, swift and precise service and problem resolution for customers, together with our standards of safe delivery secured the proportion of
This year, the group completed 5 projects as planned: (1) the Emission Improvement Project, designed to lower the level of SO X to less than 500 ppm, (2) the HVU-2 Debottlenecking Project, designed to promote the ability to process light fuel oil for the likes of gasoline and diesel to raise
domestic product sale at 84% of production capacity.
the gross margin more than USD 0.40 per barrel, (3) the
In addition, the group values product development to
Energy Efficiency Improvement Project for the CDU-3 Preheat
match customers’ needs. This year the group produced
Train, which saved up to 15% or equivalent to 20 MW of fuels
Euro 5 diesel for blending into PTT’s HyForce product.
and cut more than 23,000 tons per year of greenhouse gas
E-ordering increases the flexibility of goods ordering while
emissions, (4) solvent capacity expansion by Sak Chaisidhi
shortening transaction time. Also, markets were launched in
Co., Ltd., from 76,000 to 141,000 tons per year, and
ASEAN, Europe, and the US, boosting this year’s customer
(5) purchase of three additional crew boats by Thaioil Marine
satisfaction scoring to 93%.
Co., Ltd.
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Underway is the LAB (Linear Alkyl Benzene) Project, operated
6. Excellence in corporate governance, social
by LABIX Co., Ltd., a joint venture between Thai Paraxylene
responsibility, and stewardship of stakeholders
Co., Ltd., and Mitsui & Co., Ltd.. This company’s production
Besides striving for a high-performance organization,
process would be linked to Thaioil Group’s production
Thaioil management promotes the responsibility for
structure to capitalize on synergy. Commercial operation
society and the environment, based on sustainable
will begin at the end of 2015.
development through business processes and various activities, thus winning wide acceptance from many business
Investment in logistics and public utilities this year consisted
and industrial sectors. The group landed among Platts Top
of a distribution expansion project for paraxylene and JP-8
250 Global Energy Company Ranking for 2014: No. 52 in
in Sriracha District and an expansion of Thaioil’s Distribution
Asia and No. 165 worldwide. Alpha Southeast Asia, the first
Station, now under construction and set to begin in 2016.
and only journal dedicated to institutional investment that focused on banking and the capital market of Southeast
As for the power business, a new, 239-MW SPP under
Asia, also presented Thaioil the following 4 awards:
TOP SPP Co., Ltd., is under construction, with commercial >>
Strongest Adherence to Corporate Governance
>>
Most Improved Investor Relations
>>
Best Strategic Corporate Social Responsibility
>>
Strongest Commitment to Sustainable Energy in Southeast
operation scheduled for 2016. GPSC (Global Power Synergy Plc.), meanwhile, has filed for IPO permission to raise capital for business expansion. The stock sale is due to begin in 2015.
Asia.
As far as international business expansion is concerned,
The group highly values safety to operating staff as well as
jointly with PTT, Thaioil has submitted a proposal to upgrade
surrounding communities, securing Thaioil’s safety record
Thanlyin refinery in Myanmar, the deliberation outcome of
among the world’s best. In addition, Thai Lube Base has
which will be announced in early 2015. Moreover, there
earned a plaque for its Zero Accident Award Project for
is a paraffin wax project to be undertaken with Pertamina
2014 for the fifth consecutive year.
in Indonesia; the project is currently under a final study of investment.
The group is convinced that sustainable growth must be accompanied with the development of communities, society,
Thaioil Group also focuses on long-term promotion of
and the environment target-based targeted management
sustainability through a portfolio management project,
under good governance and ethics. With that in mind, it
designed to raise new businesses that align with industrial
has garnered the following awards from top agencies and
trends and futuristic changes in energy consumption, a supporting-function project involving personnel development,
entities in the past year: >>
SET Award of Honor for Top Corporate Governance Report
finance and treasury, social and environmental responsibility,
Award and Best Corporate Social Responsibility Award
and research innovations. These should strike a fine
for 2012-2014, presented at the SET Awards event by
balance between growth and confidence among shareholders
the Stock Exchange of Thailand (SET)
and stakeholders.
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CORPORATE GOVERNANCE & SOCIAL RESPONSIBILITY Thaioil’s Board of Directors and Management fully support the Company’s responsibility on society and the environment, and its development towards sustainability, through business processes and various activities. Additionally, through target-based work process management under the good Corporate Governance and business ethic, Thaioil staff and people in the community are urged to be aware of and prioritize their own safety to other aspects.
>>
>>
>>
An “Excellent” Corporate Governance Report of Thai Listed
In addition, Thaioil won recognition as an Asian leader
Companies 2014 award for the sixth consecutive year,
at the fourth Asian Excellence Recognition Awards 2014
presented by Thai IOD and ranked as one of Thai Listed
event, hosted by Corporate Governance Asia (a leading
Companies with highest score (above 90 points) in ASEAN
publication of Hong Kong and Asia that focuses on economic
CG Scorecard
and good governance issues). The event of which Thaioil
“Excellent” regional Corporate Governance awards
earned 2 awards:
presented by Alpha Southeast Asia, The Assets, and
>>
Asia’s Best CEO (Investor Relations)
Corporate Governance Asia journals
>>
Best Investor Relations by Company.
Outstanding sustainability award for 2014, presented by CSR Club of Thai Listed Companies Association, Office of the Securities and Exchange Commission (SEC), and Thaipat Institute
>>
CSR Recognition for 2014 for listed companies that exhibit social responsibility, hosted by SET and the CSR Institute
This was the second annual recognition, attributed to the group’s outstanding adherence to the highest standard of information disclosure, transparency, and fairness. The group also secured full marks out of an assessment by the Thai Investors Association under the association’s project assessing AGMs for 2014.
>>
>>
>>
CSR-DIW Continuous Award for 2014, designed to promote plant capability for environmental development
Thaioil Group is determined to apply its half-century of
and sustainable social responsibility, presented by the
knowledge and skills in the field of energy; operational
Department of Industrial Works, Ministry of Industry.
excellence; outstanding governance; responsibility to
“Excellent” in CSR presented by Ministry of Social
society, the environment, and communities; and commitment
Development and Human Security
to the highest satisfaction among stakeholders to strive
A certified member of the Private Sector’s Collective
to improve its business strength and become a century
Action Coalition against Corruption (CAC)
organization and an integral part of society and Thailand.
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MILESTONES OF 2014
01
J ANU ARY
THAIOIL Thailand TOP Company Awards 2014 Thaioil won a Top Management Award at “Thailand TOP Company Awards 2014”, organized by Business+, a leading journal in Thailand’s business sector, in conjunction with the University of the Thai Chamber of Commerce, recognizing business entities with outstanding overall performances as well as role models and inspiration for competitiveness development and outstanding management.
02
F E B R U ARY
THAIOIL Gold Class Sustainability Award 2014 Thaioil was named the Oil and Gas Sustainability Leader, Gold Class, by RobecoSAM, the sustainability assessor for DJSI, at “Sustainability Award 2014”. The Company is the first among PTT Group to achieve the prestigious ranking.
03
MAR C H
THAIOIL Thaioil and Financial Partners Issue Baht 15-Billion Domestic Debentures, 4.29 Times Oversubscribed Thaioil issued “Debentures of Thai Oil Public Company Limited No. 1/2014”, total amount of Baht 15 billion. The debentures are unsecured, unsubordinated without a debentureholders’ representative in name-registered certificate: Trench No. 1 Tenor of 3 years, due in 2017 for Baht 2 billion; Trench No. 2 Tenor of 5 years, due in 2019 for Baht 3 billion; Trench No. 3 Tenor of 7 years, due in 2021 for Baht 3 billion, and Trench No. 4 Tenor of 10 years, due in 2024 for Baht 7 billion. Rated “AA-(tha)” by Fitch Ratings (Thailand) Ltd., these bonds were offered to institutional and major investors.
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04
APR IL
THAIOIL Annual General Meeting of Shareholders 2014 Thaioil held its 2014 Annual General Meeting of Shareholders on April 2, 2014 for the shareholders to communicate the results of operation and issues of concern reflecting operational transparency as well as bolstering confidence of the shareholders in their investment of the Company. Asian Excellence Recognition Awards 2014 Thaioil was named a Regional Leader at the “4 th Asian Excellence Recognition Awards 2014”, organized by Corporate Governance Asia, a leading magazine based in Hong Kong and Asia with a focus on economic and CG issues. • Asia’s Best CEO (Investor Relations), based on its business performance in the previous year, its outstanding balanced operations in economic, social, and environmental aspects, marked by good governance and fair treatment of stakeholders. • Best Investor Relations by Company, for two consecutive years, based on its outstanding adherence to the highest standard, transparency, and fairness in information disclosure, apart from those reporting required by the Stock Exchange of Thailand (SET). Thaioil was also recognized as a role model Asian company,
05
MAY
S A K C H A I S I D H I C O. , LT D. , Sak Chaisidhi Expands Capacity Sak Chaisidhi Co., Ltd., expanded its hydrocarbon solvent capacity from 76,000 to 141,000 tons per year to meet the rising domestic and regional demand. Commercial operation began on May 11.
THAIOIL
equipped with excellent relations with investors and stakeholders. A Certified Member of CAC Thaioil was certified as CAC (Collective Action Coalition against Corruption) members, based on submitted information and supporting documents on its business policies, measures, operating procedures, internal controls, and others under CAC’s assessment form.
Outstanding Investor Relations Award from IAA Awards for Listed Companies 2013 Thaioil earned an Outstanding Investor Relations Award (Natural Resources industry) at “IAA Awards for Listed Companies 2013”, based on o v e r w h e l m i n g v o t e s f ro m f u n d managers and analysts. Best Investor Relations 2013 Recognition by FinanceAsia Magazine Thaioil was named by FinanceAsia, Asia’s leading financial journal, as the Thai company with the best investor relations. The company also belonged to Thailand’s leading group with outstanding performances in corporate governance, CSR, and dividend policy.
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JU NE
09
SE PT E MB E R
THAIOIL
THAIOIL
CDU-3 Major Turnaround
Interim Dividend Thaioil paid out an interim dividend for 2,040,027,873 shares at Baht 0.56 per share, amounting to Baht 1,142 million.
Crude Distillation Unit 3 (CDU-3) and core production units were shut down during June-July for 46 days, nine days earlier than planned. The major turnaround was carried out at CDU-3, Hydrocracking Unit-1 (HCU-1), Continuous Catalyst Regeneration Platformer Unit-1 (CCR-1), and the aromatics production mixed-xylenes unit of TPX. The company also conducted a tie-in with completed projects: HVU-2 and CDU-3 energy efficiency project (CDU-3 Preheat Train). During the shutdown, other refining units were uninterrupted. Thaioil Among Thai Listed Companies Assessed for CG by ASEAN CG Scorecard Ranking The Thai Institute of Directors (IOD), assigned by SEC to be responsible for the assessment of Thai listed companies’ CG, disclosed the results of the survey on the CG of listed companies in the ASEAN region: the ASEAN CG Scorecard 2013/2014. Thaioil was ranked among the Top 50 Publicly Listed Companies in Thailand, with the highest scores (over 90 points).
Thaioil Won Four Awards of Honor from Alpha Asia Magazine T h a i o i l w o n f o u r a w a rd s a t t h e “4th Annual Southeast Asia Institutional Investor and Corporate Awards 2014” organized by Alpha Asia, a leading international money and investment magazine: one at the regional level (The Strongest Commitment to Sustainable Energy in Southeast Asia), and three at the national level (The Strongest Adherence to Corporate Governance, Most Improved Investor Relations, and Best Strategic Corporate Social Responsibility). Dow Jones Sustainability Indices 2014 Thaioil was internationally recognized as a Dow Jones Sustainability Indices (DJSI) member for two consecutive years. Thanks to the best scores worldwide, it was also recognized as an energy industry group leader this year.
08
AUGUST
THAIOIL The 2014 Company’s Site-Visit Thaioil held its annual Company’s site visit for the shareholders twice this year, each could accommodate 100 people. Thaioil held this event annually to promote understandings of the Company’s business and to create confidence in the investment, which could reflect operational transparency. This event also joined by senior executives of the Company to provide their visions for operating toward sustainable growth. Thaioil’s Organized its Annual Strategic Thinking Session Each year, the Board of Directors and executive management has proposed agenda on business direction and long-term strategic plan for the Board of Director’s consideration and to bring about comments and policies as guideline in the formation of annual business plan and budget.
PTT Group CG Day 2014 Thaioil, together with PTT Group companies, jointly organized PTT Group CG Day 2014, under the concept of “The Power is in Your Hand” symbolized the Group’s cooperation to resist any corrupted action. The event was joined by high-level executives and corporate governance directors of the companies within PTT Group. This event offers the Group’s intention to follow the good corporate governance principles, while encourage its employees to have knowledge and understanding on the CG principles as well as being a role model for the society in driving the anti-corruption campaign.
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OC T O B E R
11
NOVE MB E R
THAIOIL
THAIOIL
The Board of Director’s Orientation Program The Company held its orientation program for new directors to provide knowledge and understanding in the Company’s business including strategic direction and guidance in the business operation of the Company, which will be useful in their analysis. This will support the continuous improvement of the performances as well as for the highest benefit of the Company.
Sustainability Report Awards 2014
Excellent CSR Award from the Ministry of Social Development and Human Security Thaioil took an Excellent CSR Award from Pol. Gen. Adul Saengsingkaew, Minister of Social Development and Human Security, on the ministry’s 12 th anniversary of the establishment.
Thaioil won an Excellent Sustainability Report Award 2014 from the Thai Listed Companies Association (CSR Club) in conjunction with the Office of the Securities and Exchange Commission (SEC) and Thaipat Institute. CSR Recognition 2014 Thaioil earned a CSR Recognition Award 2014, hosted by SET, in recognition of listed companies with responsible business conduct.
CSR-DIW Continuous Awards 2014 Thaioil won a CSR–DIW Continuous Awards 2014 for “Factory Potential Enhancement Towards Sustainable Environmental Development and Social Responsibility Project 2014” (CSR - DIW Awards), hosted by the Department of Industrial Works, Ministry of Industry, based on its outstanding performance meeting the CSR-DIW standard criteria and continuing CSR activities.
SET Awards 2014
Platts Top 250 Global Energy Company Ranking for 2014 Thaioil was ranked 52 nd in Asia and 165 th worldwide by Platts: Top 250 Global Energy Company Rankings for 2014, based on asset value, revenue, profits, and returns on investment.
won an Outstanding Investor Relations Award
Thaioil won SET Awards of Honor at the “SET Awards 2014” event for the Best Corporate Social Responsibility Award and the Top Corporate Governance Report Award for three consecutive years (2012- 2014). It also for listed companies. The Asset Corporate Awards 2014 – Platinum Award
Governance Asia Recognition Awards: Best of Asia 2014 Thaioil earned two awards at the “10th Corporate Governance Asia Recognition Awards: Best of Asia 2014” event, organized by Corporate Governance Asia, a leading regional journal on corporate governance: Asian Corporate Directors Recognition Award 2014, and Asia’s Outstanding Company on Corporate Governance Award. These accolades recognized Asian companies and their leaders with outstanding CG promotion and contribution to sustainable growth.
Thaioil took a Platinum Award for its all-around excellence in performance on management, CSR, social and environmental responsibility, and investor relations from “The Asset Excellence in Management and Corporate Governance Awards 2014”, organized by The Asset, Asia’s leading financial magazine.
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MARKET REVIEW 2014 AND INDUSTRY OUTLOOK
Market Review 2014 Global Market and Economy
Eurozone encountered increasing unemployment, which
The International Monetary Fund (IMF) predicted that the
touched 11.6%; deflation holding back the economic
world economy for 2014 would grow by 3.3%, or a slight
growth; and impact from the conflicts between Russia and
increase from that of 2013, which recorded 3.2% growth.
Ukraine, which affected investors’ confidence. In China, the
The main growth impetus was the recovery of the US
Chinese economy during 2014 experienced a slowdown
economy, under which the labor market surged. The US
following the government’s decision on economic restructuring
unemployment rate dropped to a six-year low of about
to seek balance between national development and the
5.8%. Private investment, excluding investment in the
decelerated industrial sector. The Chinese government,
housing sector, showed continuous expansion resulting in
however, launched the 2014 economic stimulus package
the notably stronger dollar. The situation also prompted
with targeted measures to provide assistance for SMEs and
the US Federal Reserve (Fed), at its meeting during
low-income earners. The government also lowered loan interest
October 28 – 29, 2014, to discontinue the monthly injection of
and offered low-interest loans to the agricultural sector and
USD 85 billion to purchase mortgage-backed bonds, which
five major government banks. The package also covered
started in November 2008. Contrary to the healthier economy
investment in renewable energy and utility infrastructure,
in the US, the Eurozone economy still looked weak. In Q3,
which helped slow down the economic contraction in China.
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Crude and Petroleum Products
In Q2, the crude price rebounded following the eruption of
Crude price during 2014 was very volatile. The Dubai
ethnic conflicts in Iraq, in which the Islamic State of Iraq (IS)
crude price, moving between USD 55 - 111 per barrel
seized a northern city with the country’s sizeable oil refineries
throughout the year, averaged USD 97 per barrel, down
and took control of a number of oil pipelines. The situation
from USD 106 per barrel in 2013. The crude price at the
caused concerns about Iraq’s oil export ability, since it is a
beginning of the year was down from that around late
leading oil producer and exporter. Meanwhile, the tensions
2013 due to concerns over the slowing Chinese economy.
in Libya and Ukraine still brewed with the seizure of various
China’s GDP in Q1 registered an 18-month low at 7.4%.
crude export ports by the rebel, resulting in Libya’s crude
Meanwhile, the US’s decision to reduce money injection
export during Q2 to drop to 250,000 barrels from 500,000
into its Quantitative Easing (QE) monetary measures from
barrels per day earlier in the year. In addition, some feared
USD 85 to USD 55 billion per month sparked concerns
that the conflict might affect Russia’s crude and natural gas
about possible effects on the overall US economy. Some
exports, resulting from the situations between Ukrainian
viewed that the US economy has not yet fully recovered.
government and the pro-Russian separatist rebels prompted
The sluggishness of these two huge economies might cause
the US and Europe to impose an econmic sanction and take
the global demand for oil to drop. Besides, the agreement
hold of Russian Individuals’ visas. Moreover, Q2 saw various
to ease sanctions imposed on Iran against its nuclear project
oil fields in the North Sea enter their cyclical maintenance
for six months from January 2014, which enabled Iran to
shutdowns normally starting in July, which may bring about
export about 1 million barrels per day of crude oil, was
tight oil supply in the world market. However, the exceptionally
considered another pressure on the global oil price. However,
high crude reserves in the US caused by the scheduled
the separatist problem in Ukraine and the closure of crude
maintenance shutdowns of various refineries coupled with
export ports in Libya, which resulted in lower crude export
the US GDP declining by 2.9% hampered a sharp increase
volume, helped prop up the crude price.
in the oil price.
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In Q3, the crude oil price dropped from Q2, following easing
Prices of petroleum products during 2014 continued to fall
concerns over the tight supply. Tensions in places eased,
in line with the crude price. The average price gap between
while violence in Iraq and Ukraine left intact the countries’
gasoline and crude, therefore, broadened out substantially
production and export volumes. Iraq’s crude output in
when compared to that of 2013. This was caused by the
September was increased to around 3.25 million barrels
abrupt shutdowns of gasoline production units in the region,
per day. At the same time, the negotiation to reopen crude
coupled with the higher demand for gasoline in the US. The
export ports in Libya was successful, enabling Libya to
situation produced an even wider spread between gasoline
resume more crude exports. Libya’s crude output was,
and crude. However, the gaps between kerosene, aviation
thus, increased by as much as 650,000 barrels per day to
fuel, diesel, and fuel oil prices and crude price were also
900,000 barrels per day in September. Furthermore, the
narrower than those of the previous year. This was mainly
world’s three major energy agencies, namely the International
due to the slowdown economy in the region, particularly in
Energy Agency (IEA), the US Energy Information Administration
China – a major oil consumer. This produced lower demand
(EIA), and the Organization of Petroleum Exporting Countries
for refined products and kept reserves of refined products
(OPEC), came out to express their views toward world
in Singapore at a relatively high level throughout the year.
oil supply in 2014 and 2015 that the supply is unlikely to
Moreover, the price gaps between refined products, especially
expand much. The IEA predicted that the supply for 2014
kerosene, aviation fuel, and diesel and Dubai crude, came
and 2015 would grow by only 0.7 and 1.2 million barrels
under continuous pressure from higher exports from China
per day respectively, since economies of the two major oil
and India after their refineries resumed operations at the
consumers, namely China and Europe, would barely expand.
beginning of the year. Even worse, the lower demand in Europe
This was in line with IMF’s forecast that the world economic
due to the slowdown economy could not accommodate
growth in 2014 and 2015 would slow down and grow by
exports of refined products from refineries in India and the
only 3.3% and 3.8% respectively.
Middle East. Those refineries had to divert more of their products to Asia.
In the last quarter of the year, Dubai crude oil price has fallen to its six-year low at USD 55.4 per barrel in the second half
Domestic Oil Market
of December. This was primarily because of the oversupply
Thailand’s economy in 2014 expanded by merely 0.7% after
from both OPEC and non-OPEC producers, particularly shale
having suffered the effects of political turbulence during the
oil from the US. This added to OPEC’s decision on November
first quarter. As a result, consumption and spending from
27 to maintain its production level, which triggered market
b o t h p u b l i c a n d p r i v a t e s e c t o r s re g i s t e re d a s h a r p
concerns that the oversupply might continue. The crude
contraction. The government’s investment budget at the time
price, moreover, received impact from the world’s prolonged
could not be disbursed. Moreover, industrial and agricultural
sluggish economy, which resulted in contracted demand,
export volumes recorded dips due to the weak economy
investors to move more funds from the commodity market
of Thailand’s trading partners, namely China, Japan, and
to foreign-exchange markets, and stronger US dollar
those in the Eurozone. The tourism sector also experienced
against other currencies. These factors made the oil price
a contraction due to foreigners’ concerns about the political
tumble down by USD 30 per barrel in a three-month period.
change and the introduction of martial law in Thailand.
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In Q4, however, the Thai economy was expected to expand
Liquefied Petroleum Gas (LPG) Gasoline (Ethanol included) Jet fuel Diesel (Biodiesel included) Fuel Oil 1,000 900
912 897 903 910 894
markedly, following the government’s continuous economic stimulus attempts through financial assistance for farmers and expedition of disbursement of the remaining 2014 budget
851 855 885 932 846 843 838
and 2015 budget with a focus on investment budget
800 700
spending. In parallel, the export sector started to recover
600 500
in line with the improved US economy. In this regard, the
400 300
National Economic and Social Development Board (NESDB)
200 100
issued a forecast that the Thai economy for 2014 should
0
Thousand barrels/day
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
expand by 1.0% (Thailand’s Economy Report, NESDB,
Source : Department of Energy Business (DOEB),Ministry of Energy
November 18, 2014). By and large, Thailand’s overall economy experienced the lowest growth when compared with other large economies in ASEAN, such as Indonesia, Malaysia, and the Philippines, which sported growth of 5.8%,
BCP
ESSO
IRPC
PTTGC
STAR
TOP
1,000
5.7%, and 6.4% respectively.
Demand for petroleum products for the year 2014 increased
800
by just 0.6% from the previous year’s demand. This was 600
mainly due to the slow economy in 2014. The consumption 400
of gasoline grew by 3.8%, led by the higher demand for
200
E20 and E85 gasohol, attributable to the larger number of
0
Thousand barrels/day
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
vehicles. As for diesel, consumption expanded by 0.9% due
Source : Department of Energy Business (DOEB),Ministry of Energy
to the reduction in retail price. The consumption of jet fuel and fuel oil also decreased by 1.0% and 3.9% respectively. This was because of the lower-than-expected number of tourists, who still had concerns about the martial law imposed in the country. Meanwhile, a number of industrial factories
9 % BCP 14%ESSO
and power generation plants decided to turn to natural gas
TOP
due to its lower price than fuel oil.
28 % In 2014, the domestic refining capacity averaged to 936,400 barrels per day, down from 967,785 barrels per day in the
18% IRPC
PTTGC 16 %
corresponding period of the previous year due to a large number of maintenance shutdowns. Regarding the share of
STAR 15 % Source : Department of Energy Business (DOEB),Ministry of Energy
refining volumes, Thaioil still commanded the highest portion of 28% of Thailand’s total refining capacity.
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Aromatics Market
supply soared after new aromatics plants in Asia with a
The 2014 paraxylene market contracted sharply from 2013
combined capacity of 2.6 million tons per year ran at their full
because of additional supplies from new paraxylene plants
steam. Toward the end of the year, demand for downstream
in Asia, with a combined capacity of as high as 6.5 million
products, such as styrene monomer and phenol, decreased
tons per year, higher than the previous year of 3.6 million
in line with the Chinese economy, causing the prices to
tons. This led to an oversupply. The slow economy of China
plummet. While the crude price continued to fall and many
also hindered the growth of demand for polyester, one of
producers experienced losses, demand for benzene, thus,
paraxylene’s downstream industries, allowing an expansion
reduced noticeably. Olefins plants that turned to naphtha
of only 4.3%, which was lower than the previous year’s
as feedstock replacing LPG during winter produced higher
growth of 7.7%. As a consequence, producers of Purified
volumes of aromatics by-products, benzene in particular. This
Terephthalic Acid (PTA), a feedstock for polyester production,
was another contribution to the oversupply, squeezing the
reduced their production capacity, resulting in lower demand
spread between benzene and gasoline 95 around the end
for paraxylene.
of the year. If the crude price continued to fall, the benzene price would be affected in the long run, since the US might
The paraxylene market was heavily pressured after new
turn to heavier feedstock which yields more benzene as a
aromatics plants in China, Saudi Arabia, South Korea, India,
by-product.
Singapore, and Algeria came on stream. This was coupled with the turnaround of aromatics plants in China and South
Lube Base Oil and Bitumen Market
Korea with a combined capacity of 2.3 million tons per year.
The lube base oil and bitumen market for 2014 remained
Even worse, the falling price of crude oil toward the end of
stable from 2013. During the first half of the year the market
the year made PTA producers delay their purchases, while
was spurred by demand during Q2, which is the usual
putting continuous pressure on paraxylene prices. However,
time of the year for lubricant changing, particularly for the
a new aromatics plant in Kazakhstan with a production
agricultural sector. The surging demand accompanied the
capacity of 469,000 tons per year announced its production
tight supply following maintenance shutdowns of lube base
delay to the year 2015. Furthermore, high-cost paraxylene
oil plants in China and India. This consequently caused
producers in South Korea, Japan, and Indonesia cut their
lubricant producers to raise their purchase volumes of lube
production, while many other producers shut down their
base oil to satisfy demand. During the second half of the
plants for maintenance. The oversupply, thus, partly eased.
year, however, the supply started to dwindle as from Q3, when the rainy season in Asia begins. The market was,
The benzene market during 2014 was comparable to that
moreover, pressured further by the higher supply when lube
of 2013 with continued imports from Asia into the US after
base plants (Group-2 base oil) in the US and South Korea,
olefins producers in the US turned to use lighter feedstock,
with a combined capacity of 1.85 million tons per year, came
such as ethane and LPG (cooking gas), resulting in lower
on stream at the beginning of Q3. This led to fierce price
output of benzene, a by-product. Coincidentally, styrene
competition between lube base oil of Group-1 and Group-2.
monomer and phenol markets, which require benzene
Toward the end of the year, the market was pressured by the
feedstock, grew well during the first half of the year, shoring
lower crude price, causing the price of lube base oil (both
up the world economy. In the second half, however, benzene
groups) to fall. Nevertheless, the price gap between lube
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base oil and fuel oil remained unchanged from 2013 due to
while the supply stayed unchanged. The domestic glut was
the sharp drop in the fuel oil price.
thus apparent, leading to tougher price competition. It was earlier hoped that the situation should improve by the end
The bitumen market in 2014 shrank slightly from 2013 due to the weak demand during Q1 – Q3, particularly demand
of the year, but, due to the dramatic fall in the crude price, demand for solvents did not rise—as producers, fearing
from China and Indonesia, the region’s two major bitumen that the crude price could possibly fall further, delayed their importers. The slow economy of China led the Chinese government to tighten the belt while the weaker rupiah caused the Indonesian government to delay bitumen imports after completion of a number of road construction projects in the middle of January. The weaker demand triggered
production, resulting in the negative growth of the solvent market during 2014.
C l e a n P ro d u c t a n d P e t ro c h e m i c a l Ta n k e r Market
bitumen producers with high stocks to reduce the price to The market for tankers for transporting oil, petroleum, and lure buyers. However, demand in the region bounced back petrochemical products during 2014 showed a satisfactory around the end of the year, when Indonesia and Vietnam imported more bitumen to speed up their road construction and maintenance, targeted for completion before the New Year’s holidays. The situation accompanied the significantly low fuel oil price, which moved in line with the crude price. The bitumen price, therefore, stayed higher than that of fuel oil during Q4, while registering just a slight drop of the year-round average price.
growth since neighboring countries also imported more oil, which resulted in continued demand for oil transport service. The occupancy rate of Thaioil’s tankers for oil, petroleum, and petrochemical products was 92%. Even though more tankers from China, where the economy was slowing down, joined the competition in the region during the year, the higher demand helped maintain sea freight tariffs at the previous year’s level. Amid the sharp fall in crude prices
Solvent Market
around the end of 2014, VLCC freight tariffs not only stayed
Thailand’s demand for solvents contracted with the overall
unchanged, but moved in a rising trend, resulting from the
economy and political climate. The thinner demand was
seasonal demand and higher demand for tankers for
caused by lower consumption in the private sector and
floating storage vessels. In addition, demand for tankers for
reduced exports. Note that exports that were expected to
ship-to-ship (STS) offloading resumed at a high level after a
offset the depressed domestic demand did not progress as
number of tankers were used as floating storages, leaving
planned. This was evident in more relaxed import duties in
fewer tankers in the market.
India, which restricted the Thai product’s competitiveness, and China’s high tax barrier for some products, which caused
Regarding the crew boat market during 2014, more crew boat
Chinese importers to divert their products to ASEAN countries.
service providers joined the market since more petroleum
New and existing producers with higher capacities, such
exploration and production companies in Thailand preferred
as those from Korea, China, Romania, also contributed
domestic crew boat service, resulting in satisfactory market
to the glut. Moreover, demand for paraxylene both in and
expansion. The occupancy rate of Thaioil Group’s crew
outside Thailand continued to shrink, producing impacts
boats stood at 89.3% with a continued demand both in
on both the price and the demand for toluene and xylene,
and outside Thailand.
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Ethanol Market
for power output and power purchase (production by EGAT
In 2014, demand for ethanol for gasohol production in
and purchase from independent producers) was expected
Thailand increased from that of the previous year. The ethanol
to grow by 2.35% from that of the previous year. The peak
demand reached 3.25 million liters per day, an increase of
demand for the year occurred on April 23, 2014, registering
25% from the corresponding period of 2013. This was due
26,942 MW, a rise of 1.29% from the previous year’s peak.
not only to the popularity of products in the gasohol group, particularly E20 and E85 gasohol. Moreover, the increment
Under the current power transmission capacity, when natural gas deliveries from Myanmar, Bongkot Field, and JDA – A18
of new gasohol-consumption vehicles in the market along Field were suspended and gas delivery from Yetagun Field with the continuous growth of gasohol E20 and E85 service in Myanmar was reduced while the LNG reserve was low, stations significantly cause the ethanol demands to Thailand had to turn to power generation from fuel oil and increase. diesel. A total of 132.6 million liters of fuel oil and 15.5 million One new ethanol production plant was launched in 2014,
liters of diesel kept up power system stability. The country
raising the overall daily production capacity by 0.27 million
also opted for power purchase from Malaysia, of which the
liters. Of the total output of 4.22 million liters per day
cost was comparable to that of power generation from diesel.
throughout 2014, cassava-based ethanol output registered
Industry Outlook 2015
1.28 million liters; sugar cane-based ethanol, 0.23 million; and molasses-based ethanol, 2.71 million. But when the
Market and World Economy
government policy to control the purchase of ethanol from
The International Monetary Fund (IMF) projected that the
molasses and cassava at a ratio of 62 : 38 ended, demand
world economy in 2015 would expand by 3.8% (according
for molasses-based ethanol outgrew that produced from
to the October 2014 report), representing growth of 3.3%
cassava. In 2014, the ethanol production ratio between
from 2014. Economies of developed countries are expected
molasses and cassava averaged 68 : 32.
to expand by 2.3% while those of developing countries like China, India and among others in Asia, would grow by 5.0%.
The ethanol price of 2014 surged from that in the previous
However, the world economy could expand less than the
year, particularly molasses-based ethanol, thanks to the rising
forecast due to risk factors and uncertainties as follows:
demand. The price of tapioca-based ethanol rose by 1.5%, selling at 27 – 29 Baht per liter, while that of molasses-based
The US: The market is still keeping a close watch on the
ethanol rose by 13.3%, selling at 23 – 26 Baht per liter. This
strong recovery of the US economy to see if it can carry on
was mainly due to the discontinuation of the government
after having received a push from the much improved labor
support on the purchase of ethanol from molasses and tapioca at the ratio of 62 : 38 causing oil traders to buy more ethanol produced from molasses.
market. The US unemployment rate fell steadily to its six-year low at 5.8%, while private investment has reportedly been on the rise. Nevertheless, the better economy may trigger the US Federal Reserve (Fed) to increase the policy rate
Power Industry
around the middle of 2015 after having discontinued its
Following the government’s economic stimulus policies,
monetary injection into the mortgage-backed bond market
which resulted in the improved economy, the year’s demand
in October 2014.
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Eurozone: The IMF is expected that the Eurozone economy
resume higher production, while crude supply from the US
would gradually pick up with growth of 1.3%. Major influencing
is expected to stay at a high level. Even though the world
factors behind the slow recovery are the notably escalating
economic recovery looks positive, it will still be fragile,
unemployment and the perpetual low inflation, which were
resulting in weak demand for crude.
partly caused by the slumping crude price in the world Crude Supply: Crude supply over 2015 is expected to market. The economic growth could, moreover, be impeded expand further. The International Energy Agency (IEA) foresaw by the slow move in private investment and limitations faced that supply volumes from non-OPEC producers during 2015 in the implementation of economic stimulus measures. Impacts from sanctions by Eurozone countries on Russia and conflicts in the region could also affect investment confidence. Some, however, envisaged that The European Central Bank (ECB) might impose additional economic stimulus measures, that is, issuance of a Quantitative Easing (QE) policy, to speed up the regional economy and avoid deflation.
(according to the December 2014 report) would average USD 57.84 million barrels per day, up by 1.31 million barrels per day from 2014. Supply of crude oil would come mainly from shale oil in the US. However, the tumbling crude price may also discourage production and investment in shale oil in the US. The IEA also envisaged that in 2015 Russia would reduce its crude output by 70,000 barrels per day. Meanwhile, OPEC predicted that their members would bring down their
China: China’s 2015 economy is expected to decelerate
crude demand during 2015 to 28.92 million barrels per day,
slightly. The IMF foresaw that China’s economy would grow by
the lowest level since 2003.
only 7.1% in 2015, against 7.4% in 2014, citing the impacts of China’s policy on economic restructuring to reduce dependence on exports, while increasing investment in the nation’s development to ensure that the country could move forward in equilibrium. However, the Chinese government earlier issued some policies on short-term economic stimulus, namely lenient tax measures to support SMEs, government investment in infrastructure, reduction of loan interests, and reduction of the required reserve ratio for commercial banks to spur continuous economic growth.
Crude and Petroleum Products in the World Market
Demand for Refined Products: The IEA adjusted its forecast on the world’s crude demand downward, envisaging growth of 900,000 barrels per day that would make the total output 93.3 million barrels per day. Taken into account was the lowered consumption in Russia and developing countries, which was brought on by the fragile economic recovery, higher labor cost, and pressure from deflation. Meanwhile, China – the world’s number two oil consumer – may not show such high demand for oil amid its decelerated economic growth in 2015. However, demand in developing countries such as India is seen on the rise according to each country’s economic expansion.
The Dubai crude price in 2015 is likely to average around
Regional Refining Capacity: In 2015, a new refining
USD 53 per barrel, considered a sharp fall from the 2014
capacity of about 0.18 million barrels per day in the
average of USD 97 per barrel. This is because supply could
Asia-Pacific region would primarily come from China and
exceed demand, thus leading to a glut. The oversupply
India. A large volume of additional capacity, or about 0.6
volumes could come from both OPEC and non-OPEC
million barrels per day, in the Middle East is also foreseen,
producers. During 2015, Iran and Libya are expected to
mainly from new refineries in the UAE and Saudi Arabia.
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Politics in the Middle East: A focus is placed on the
Domestic Oil Market
discussion between Iran and six superpowers to be held
The Office of the National Economic and Social Development
on July 1, 2015. If Iran agreed not to progress its uranium
Board (NESDB) projected that Thailand’s economy in 2015
development for producing nuclear weapons in exchange for
would expand between 3.5% - 4.5% (Thailand Economy
the revocation of sanctions imposed on Iran, the country’s
Report, NESDB, November 18, 2014). Supporting factors
crude export could be resumed. Iran will, however, have to
for economic growth would be higher public spending and
take a while to restore its equipment and facilities in order
investment following expedition of budget disbursement,
to take 1 million barrels of oil to the market, as earlier done
implementation of various infrastructural development
before the sanctions. In Libya, the unrest is expected to
projects in the transport sector, and economic stimulus
persist. The rebel group will keep hold of major oil fields,
package -- part of which is financial assistance for farmers.
including El Sharara and El Feel, amid attempts to restart
Moreover, IMF in its report on October, 2014, predicted that
various sites and increase production volumes. Libya is
the world economy would grow from 3.3% in 2014 to 3.8%
expected to export more crude in 2015. In Iraq, the continued
in 2015, which would benefit Thailand’s exports and tourism
disorder caused by IS is unlikely to affect Iraq’s crude export.
rebound. In the private sector, consumers’ spending will
The decision by OPEC to maintain its output level may affect
recover from the previous years in accordance to the boost
some members, particularly Iran, Venezuela, and Nigeria,
of confidence of the private sector and that people are
who sustained severe impacts of low crude prices on top of
expected to spend more of their windfall income obtained
their fragile economies. This might trigger domestic unrest.
from the sharply reduced oil price. Investment in the private
Seasons and Natural Disasters: Not only seasons cause demand for each different type of oil to vary. Natural disasters that occur more often today can also shape the oil price. This include hurricanes in the Atlantic, which normally hit crude-producing fields and refineries in the Gulf of Mexico, and typhoons in the Pacific and South China Sea, which could damage refineries in Asia-Pacific countries.
sector has continuously moved on the upward trend thanks to approvals for BOI privileges. However, more fund relocation and more fluctuated exchange rates are expected to pose risks on the Thai economy, since the US Fed is likely to increase the policy rate from 0.25% at present. One more risk factor could be the economies of countries in Europe, Japan, and China, which may not expand as expected and, thus, restrict the growth of Thailand’s export and tourism sectors.
Laws and Regulations: After governments of such countries as Egypt, Kuwait, China, India, Indonesia, Malaysia, and
The overall consumption of refined products in 2015 is
Thailand started to reduce their energy subsidies, demand
expected to expand by 2.1% from 2014 as a result of the
for refined products has dipped. Moreover, many countries
better economy, which is predicted to move upward from
have turned to environmentally friendly fuels, thus issuing
1.0% to 3.5% - 4.5% in 2015. Key supporting factors would
policies that promote renewable energy that helps cope
be the higher spending and tourism rebound. As for demand
with global warming. The US, Europe, and many countries
for fuels, diesel consumption would grow by 1.1%, gasoline
in Asia, like Indonesia, Vietnam, the Philippines, and even
by 4%, LPG by 2.9%, and aviation fuel by 3.2%. Meanwhile,
Thailand, have been enforcing more blends of ethanol in
one risk factor that should be closely monitored during 2015
gasoline and biodiesel in diesel.
is energy price restructuring, which is intended for setting
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ANNUAL REPORT 2014
energy prices that reflect the actual cost. Retail prices of
for downstream industries and push demand for benzene
LPG and diesel are thus likely to rise and may affect
further.
short-term demand.
Lube Base Oil and Bitumen Market Aromatics Market
The price competition in the lube base oil market starting in
The paraxylene market in 2015 is expected to stay at a low
the second half of 2014 would still go on into 2015 because
level since global demand for polyester could drop to only
the global demand for lube base oil is expected to expand
4%, down from 2014’s level by 5.2%. This is because
by only 1.1%, or 400,000 tons per year. At the same time,
China, the major paraxylene consumer, is going through a
more supply will come from new refineries in China, Serbia,
slowdown economy. The market could also be pressured
and Vietnam with a combined capacity of 1.28 million tons
by additional supply from new paraxylene plants with a
per year. Some excess supply is also expected to come from
combined capacity of 3.4 million tons per year in Kazakhstan,
Group-2 lube base oil plants in the US and South Korea and
China, and India, as well as capacity expansion in Thailand.
from some plants producing Group-3 lube base oil which
However, the market could be shored up by new PTA plants
started operations in 2014 with a combined capability of
in China, India and Taiwan coming on stream with a combined
3.5 million tons per year. This will prompt more Group-2 lube base
capacity of 5.6 million tons per year (reflecting demand for
oil producers to join the price competition to lure customers.
paraxylene feedstock of 3.7 million tons per year). In addition,
However, it is predicted that those Group-2 lube base oil
those high-cost paraxylene producers are likely to cut their
producers would fail to make their prices any lower than
production level further, which will consequently ease the
that of Group-1 lube base oil because of their higher cost.
paraxylene glut.
Producers of Group-2 lube base oil may eventually have to lower their output ceilings. The situation will bring the overall
The benzene market in 2015 is likely to be pressured. The
lube base oil price down only slightly from that of 2014.
US – the main benzene importer from Asia – may lower its benzene imports following the slump of the crude price,
The bitumen market in the region is expected to grow
which could prompt some shale gas producers to cut their
following demand of various countries needing the product
production. The situation, moreover, could cause olefins
for developing their roads and land transport infrastructure
producers to return to heavier feedstock, such as naphtha,
to welcome the AEC at the end of 2015. Therefore, countries in
which yields more benzene as a by-product. In addition,
the region would tend to export less to accommodate their
China’s slow economy could affect benzene demand since
domestic demand. This would further result in tight supply
China is the world’s leading styrene monomer producer,
in the region. Meanwhile in Thailand, domestic demand for
which relies on benzene as feedstock. However, the global
bitumen would soar in accordance with the government’s
demand for benzene would still expand by 3.3%, or 2.3%
projects on land transport infrastructural development
growth from 2014’s level, as a result of the positive sign
spanning 2015 – 2023. It is therefore expected that the
of continuous growth of some industrial sectors like
bitumen price will stay at the same level as that of 2014,
electronics, toy, packaging, furniture, and electrical appliance
while the spread between bitumen and fuel oil will expand
industries. The situation would consequently raise demand
as affected by the weaker crude price.
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Solvent Market
Clean Product and Petrochemical Tanker Industry
The overall demand for solvents during 2015 is expected
VLCC Market
to rise from the previous year by 3% - 4% in response to the
In 2015, It is foreseen that refineries in the region would expand
recovering world economy, especially in the US, where a
their capacities by 3 – 4 million barrels per day by 2020. This
positive economic sign has been explicit since late 2014. In
will consequently lift demand for VLCC, both in Thailand
Asia, solvent demand is also predicted to expand but would
and in the region. In the next five years, demand for VLCC
not cover all of the rising supply, especially in big markets,
is expected to post average growth of only 3% per year.
such as China, where the economy is expanding at negative
However, the transport cost in the VLCC market is believed
growth due to the government’s control to ensure economic
to have already bottomed out during the past two years and
stability. This would cause a domestic glut, leading to the
should now start rising.
need to export. At the same time, China has imposed a new
AFRAMAX Market
import tariff to safeguard Chinese producers. This caused
The increasing demand for oil each year both within the
neighboring countries, including Japan, South Korea, and
country and in the region naturally produces continuously
Taiwan, which have been relying heavily on the Chinese
growing demand for crude and refined products in the region.
market, to divert their exports elsewhere, especially to
AFRAMAX vessels are not only required for oil transport, but
Southeast Asia such as Thailand and Indonesia to offset the
are also needed for use as floating storage. Nevertheless,
lost market. This will consequently bring about high
only a small number of newly constructed AFRAMAX vessels
competition in the region. In addition, India, also a large
are on the horizon, while some were built to replace those
solvent market, will be unable to take all supply volumes,
aged ones. Growth of AFRAMAX is thus low, and higher
which not only come from Asia but also from the Middle
sea freight tariffs for this type of vessel could therefore be
East and Europe due to the lower costs of feedstock in
envisaged.
Europe influenced by shale gas from the US, coupled with transport cost advantages against shipment from Asia to India. All in all, the solvent market in Asia is expected to grow by 4% - 5% on average. In Thailand, rising demand was seen after the political turmoil in the beginning of 2014. Thailand’s economy for
Chemical Tanker Market The domestic chemical tanker market is foreseen with continued growth due to PTT Group’s requirements for both domestic transport and exports to Asian markets, particularly neighboring countries, where economies fleet demand are expanding.
2015 is projected to grow around 4% - 5%. However, supply
Crew Boat Market
of some categories of products would surge with higher
Continued demand is projected for crew boat service to
imports from North Asian countries like China, Japan,
support crude exploration and production operations in
Korea, and Taiwan for the situation mentioned above.
Southeast Asia. Today, more crew boats carrying the Thai
Accordingly, the competition in Thailand would be intense.
flag are coming into the market and replacing foreign boats.
It is foreseen that the solvent industry would grow by about
With a promising future envisioned, the time is considered a
4% - 5%.
good opportunity for investment in the business.
043
THAI OIL PUBLIC COMPANY LIMITED
Marke t Re vi e w 2 0 1 4 an d In d us tr y Outlook
ANNUAL REPORT 2014
Ethanol Market
Power Industry
Demand for ethanol during 2015 is expected to rise to 3.6
It is projected that peak demand in 2015 could possibly
million liters per day as a result of the growing consumption
reach 27,646 MW, growth of 2.61% from the previous year,
of E20 and E85 gasohol, resulting from the government’s
with the grid’s available reserve margin as high as 22.7%.
push through retail price restructuring. The higher number of
The higher reserve came from new capacities during 2014,
vehicles and service stations selling E20 and E85 gasohol
that is, Wang Noi – Unit 4, Chana – Unit 2, and Gulf Nong
are also key supporting pillars for the higher ethanol demand.
Saeng – Unit 1 and Unit 2. Total demand of 184,509 MW from both power generation and power purchases is estimated
In 2015, three new ethanol plants would be completed; two plants using cassava with a combined capacity of 0.4 million liters per day, and another using molasse with the capacity of 0.1 million liters per day. The new capacity of 0.5 million liters per day will bring the country’s overall ethanol production to about 4.72 million liters per day. The ethanol price in 2015 is likely to rise from last year due to the higher cost of raw materials. The 2014 and 2015 crop of sugarcane is expected to decline due to drought, resulting in the small amount of molasse to the market, causing higher price of molasse - based ethanol. Meanwhile, cassava price in 2015 is likely to increase following the expected higher demand from animal feed and ethanol industries both in and outside Thailand.
for 2015, or 3.88% higher than the 2014’s demand. Natural gas will still be the prime source of fuel with a 67% share of the total energy sources, followed by coal, at 21.1%; hydro power, 8.6%; renewable energy, 2.6%; and power purchase from Malaysia, 0.1%. Power production from oil is planned for 0.6%, since oil is still needed for running Krabi and Surat Thani plants to ensure power supply security in the South. This is because natural gas deliveries from Myanmar and the JDA (Malaysia-Thailand Joint Development Area) will decline during 2015. Moreover, gas delivery form the JDA –A18 Field is scheduled for shutdown during June 7-13 and August 30 – September 8, 2015. Consumption scenarios of oil for power generation in 2015 is, however, considered superior to 2014, since new capacities of over 3,000 MW will be added to the national grid, as detailed below:
New capacities planned for 2015 2015
Power Plant
Fuel
MW
Location
June
Hongsa, Unit 1
Coal
491
North
June
Gulf U-Thai, Unit 1
Natural gas
800
Central
November
Hongsa, Unit 2
Coal
491
North
December
Gulf U-Thai, Unit 2
Natural gas
800
Central
January – December
SPP
Natural gas
450
Nakorn Luang, East, and West
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THAI OIL PUBLIC COMPANY LIMITED
P roduct i o n P ro ces s es a n d P r o c e s s D e v e lo p m e n t / Qua l i t y, S ecuri t y, S a fe ty, H e a lth , a n d E n v ir o n m e n ta l M a n a g e me n t
11
ANNUAL REPORT 2014
PRODUCTION PROCESS AND PROCESS DEVELOPMENT/ QUALITY, SECURITY, SAFETY, HEALTH, AND ENVIRONMENTAL MANAGEMENT
the reconfiguration of the heat exchangers, for maximum efficiency. The innovative idea on advanced design of the heat transfer system came from a joint study with a university, featuring replacement of the convection “M Major repair and debottlenecking o Crude Distillation Unit-3 of (CDU-3)helps save 26% fuels, (CD yield higher outputs of jet fuels yie and diesel, and enable the operation capacity at up to 5.7% op higher than designed.” hig
bank and the insulated walls of the heater. By heating crude oil, one raises the efficiency of heat exchange. To improve refining yield efficiency, distillation trays within the distillation columns were also replaced. With the maintenance work completed, CDU-3 returned to full capacity and saved 26% fuels (about 26,000 tons per year), while yielding about 5 million liters per month of
Oil and Petrochemical Refinery This year, Thaioil’s throughput of crude oil and other raw materials averaged 269,000 barrels per day, about 98% of the nameplate capacity. Meanwhile, TLB posted an average processing rate of 245,000 tons per year, 92% of its nameplate capacity; TPX, 684,000 tons per year, 82% of its nameplate capacity. These rates conformed to the optimum production plan jointly formulated by the three companies. The year saw a refinery turnaround in June and July, designed to inspect and repair various processing units, an array of tasks more efficiently and rapidly completed than planned, notably CDU-3, with the highest capacity. As a result, the refinery resumed operation in no time to meet the demand
higher-value jet fuels and about 4 million liters per month of more diesel from heavy crude residue. Also, the fuel consumption reduction in CDU-3 and the higher outputs of jet fuels and diesel raised the gross refining margins by about USD 0.14 per barrel. And should the refinery need greater outputs, CDU-3 can operate at up to 5.7% higher capacity than designed, which will add significant profit.
>> Major Shutdown of Crude Distillation Unit-1 (CDU-1) and High Vacuum Unit-1 (HVU-1) to remove coke from heater coils to restore full efficiency. The expired heater floor was also replaced.
>> Stopped the hydrodesulfurization unit to replace expired catalysts to restore efficient production.
for petroleum products. Thaioil Group undertook assorted projects to optimize the efficiency of processing units and
>> Major Shutdown and performed ceramic coating on
production operation to constantly enhance the capability
furnace coils in the input furnace of Continuous Catalyst
and competitiveness. These projects are summarized below:
Regeneration Platformer (CCR-1) to raise heat-exchange efficiency by about 3%.
Thai Oil
>> Major turnaround to debottlenecking of Crude Distillation
>> Major Shutdown of HVU-3 by replacing the convection
Unit-3 (CDU-3)’s energy consumption through the design
bank so as to raise efficiency, cutting fuel use and adding
and installation of 15 new heat exchangers, together with
product value by about Baht 34 million a year.
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THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
Prod u c t i on Proc e sse s an d Proc e ss Development / Qu al i t y, Se c u ri t y, Safe t y, He al t h , an d E n vi ron m e n t al Management
>> Installation of a Real Time Optimization (RTO) system, a
Shell Global Solutions. Feeding heavy crude from HVU-2
process control system with the most advanced and most
into HVU-2/DC hikes the diesel output, resulting in the
effective technology at two additional units, namely
increment of Gross Refinery Margin to approximately
Hydrocracking Unit-1 (HCU-1) (fuel oil value addition
USD 0.47 per barrel.
with a catalyst and hydrogen) to raise jet fuel and diesel outputs and Fluid Catalytic Cracking Unit (FCCU) (fuel oil value addition) to raise the gasoline output.
>> Operation of the Increase NG Consumption for Refinery (NGLN) Project including natural gas distribution through
>> Maintenance and replacement of catalysts of the HCU-1, adding jet fuel and diesel outputs by about 3%, or a profit at the year-end of about Baht 435 million. A by-product is that the refinery can now accommodate low-cost crude oil with high nitrogen contents.
a new gas metering station and a new fuel pipeline system, Thai Lube Base can support the NG demand from future projects.
>> Won the Zero Accident Award for the fifth consecutive year The NGLN project saw adjustment of 37 burners to the low-NO X type to accommodate demand for natural
from the Department of Labour Protection and Welfare, Ministry of Labour.
gas from emerging projects, add stability to the refinery’s energy system, and cut air pollution. This project had
>> Developed and distributed Mild Extract Solvate (MES),
earned invest promotion under one of the government’s
a new, environmental friendly processing oil, since June.
BOI measures to save energy, use alternative energy, or ease environmental impacts.
>> Replacement of the boiler water, replacing high-cost seawater distillation with much cheaper raw water, thus lowering the production cost by about Baht 40 million per year.
>> Shut down for 12 days in September to install two additional Propane Deasphalting Unit (PDA) heat exchangers and took the opportunity to clean heat exchangers for greater efficiency. The tasks were completed as planned and saved 3 MW of energy (equivalent to about Baht 41 million per year) with the newly installed equipment.
>> Commissioning of the Emission Improvement Project (EIP) from the beginning of the year to improve the quality of
Thai Paraxylene
waste gas by changing gaseous hydrosulfide into sulfur.
>> Major Shutdown to enable all processing units to run at
The 99.8% efficiency improved air emissions beyond
full capacity.
legal requirements. The sulfur dioxide gas emissions are
>> Replaced furnace burners with low-NO X ones during the
now under 250 ppm, versus 500 ppm as required by law.
turnaround, dropping the NO X in the waste gas from
A by-product is that the refinery can now accommodate
115 ppm to only 27 ppm.
high-sulfur crude oil, which would lower costs further.
>> Improved energy efficiency by reusing heat exchangers, >> Start of the HVU-2 Revamp Project in May with the application of the Deep Cut technology originated by
in the process cutting distillation process heat loss and saving about 1 MW of energy.
046
THAI OIL PUBLIC COMPANY LIMITED
P roduct i o n P ro ces s es a n d P r o c e s s D e v e lo p m e n t / Qua l i t y, S ecuri t y, S a fe ty, H e a lth , a n d E n v ir o n m e n ta l M a n a g e me n t
ANNUAL REPORT 2014
CRUDE AND FEEDSTOCK REFINING PROCESSES ( Including Petrochemical and Lubricating Oil Processing of Thaioil Group )
FUEL GAS
ADIP
LPG
ISOM
HDT-1
PLATFORM
HDT-2 CCR-1 HDT-3 PREMIUM
CCR-2 CCG HDS CDU-1
REGULAR
CRUDE CDU-2
JET
KMT CDU-3
KEROSENE FCCU HDS-1
HVU-1 HMU-1
HVU-2/DC
LONG RESIDUE
HDS-2 AGO
HMU-2
HVU-3
TCU
HDS-3
HCU-1
DIESEL
HCU-2
FUEL OIL ADIP
SRU-1/2 SRU-3/4 SRU-5
F l ow Diagram of Th aioil Refiner y, a com p lex refiner y in Thailand
SULPHUR
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THAI OIL PUBLIC COMPANY LIMITED
Prod u c t i on Proc e sse s an d Proc e ss Development / Qu al i t y, Se c u ri t y, Safe t y, He al t h , an d E n vi ron m e n t al Management
ANNUAL REPORT 2014
S I M P L I F I ED AROM ATIC S CONFIGURATION
D IS T ILL ATION
QU AL IT Y IMPR OVE ME NT
U PGR ADING
P RODUCT
By products
ED Sulfolane BT Franct. I
Benzene Mixed Xylene
Platformate
CCR
Toluene
Benzene
MX
MX
PX
Paraxylene
By products
By products
PX Max BT Franct. II
Imported Toluene
MX
F low Diagram of Thai Par axy lene, with arom atics outp uts as f e e dstoc k f or th e down stre a m pe troc h e m e c a l in du str y
SIMPLIFIED LUBE CONFIGURATION
D IS T IL L AT IO N
QU AL IT Y IMPR OVE ME NT
PR O DUCT
VGO / Extract / Slack Wax
60/150SN
60/150VGO Import Long Residue
VDU
500SN
500VGO
MPU
HFU
150BS
DAO Hydrocracker Bottom
Slack Wax Vacuum Residue
Sulphur
PDA
Extract
TDAE 2 nd Extract F low Diagram of Thai Lub e Base
Base oil
SDU
TDAE
Bitumen
Slack Wax
Sulphur
Extract
TDAE
Bitumen
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THAI OIL PUBLIC COMPANY LIMITED
P roduct i o n P ro ces s es a n d P r o c e s s D e v e lo p m e n t / Qua l i t y, S ecuri t y, S a fe ty, H e a lth , a n d E n v ir o n m e n ta l M a n a g e me n t
ANNUAL REPORT 2014
Quality, Security, Safety, Occupational Health, and Environmental Management Thaioil Group has laid down a set of guidelines on the management of quality, security, safety, occupational health, energy, and social responsibility by applying the following ISO systems: 1. TIS 9001 (Quality Management) 2. TIS 14001 (Environmental Management) 3. TIS 18001 (Occupational Health and Safety Management) 4. BS OHSAS 18001 (Occupational Health and Safety Management) Refining Performance Assessment For the year, Thaioil successfully maintained its refinery
5. Integrated Management System (IMS)
capability, with a safety record among the top quartile of
6. ISO/IEC 17025 (Laboratory Competency Management)
the oil & gas group. 7. CSR (ISO 26000) (Social Responsibility Management) For operation readiness, Thaioil maintained satisfactory plant availability. This year’s planned turnaround for inspection and
under CSR-DIW Project 8. ISO/IEC 27001 (Information Security Management)
maintenance work was completed ahead of time, enabling Thaioil to resume operation earlier. For production efficiency, projects were undertaken for margin improvement, with results far exceeding the goals. The bulk of the additional profits come from the greater
9. ISO 50001 (Energy Management). Since 1996, the Company has continuously maintained and improved these systems, which led to the formulation of Thaioil Group’s current policy on the management of quality, security, safety, occupational health, environment, energy,
outputs due to the much shorter turnaround, the ability to and social responsibility, intended for: refine low-cost crude grades that are heavier or contain more nitrogen after the completed HVU-2/DC project and
>> Development of quality products and services to meet
the HCU-1 debottlenecking project, together with other energy
customer satisfaction under standard management
efficiency projects. This year more than 20 energy conservation
systems, laws and regulations, as well as other related
projects got underway to add efficiency to processing units,
standards and requirements
saving process fuels by more than 50 MW (more than Baht
>> Formulation of a systematic risk management plan to 620 million per year) and cutting greenhouse gas emissions by more than 88,000 tons of carbon dioxide a year.
control and minimize operational risks, namely physical, chemical, biological, and psychosocial risks, to prevent incidents that may cause injuries or illness to workers.
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THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
Prod u c t i on Proc e sse s an d Proc e ss Development / Qu al i t y, Se c u ri t y, Safe t y, He al t h , an d E n vi ron m e n t al Management
The Company also pays attention to the proper use of
private intelligence networks and seeking external help.
its workforce.
Exercises were held for the emergency response team,
>> Formulation of goals to control and reduce potential impacts of international-standard business processes,
followed by assessment and improvement for maximum effectiveness.
encompassing occupational health, safety, and the
>> Controlled and promoted compliance with the safety and
environment; responsibility to customers, society, and
security manual for Thaioil Group employees for safe
communities; energy efficiency and climate change;
day-to-day living in and outside work.
prevention of leaks of oil and chemicals; and water resource management—all these elements accompany reviews,
Occupational Health and Safety Management
follow-ups, and inspection for continual improvement
The occupational health and safety of employees, communities, contractors, and stakeholders are Thaioil’s top priority;
>> Provision of adequate resources and information technology previous projects and practices can secure Thaioil as a to comply with the policy on quality, security, safety, national industry leader. As a result, it has updated its occupational health, the environment, energy management, five-year plan on occupational health, personal safety, process and social responsibility. safety, and emergency and crisis management.
>> Constant development, reviews, and updates of policies and regulations to keep up with changes in business,
In implementing its five-year plan covering occupational
laws, technological development, and environmental and
health, personal safety, process safety, emergency and
social circumstances.
crisis management, and safety leadership, a dedicated unit controls and drives performance under the plan. Appointed
Thaioil remains committed to embracing management
was an occupational health, safety, and workplace
standards for sustainable development.
environment panel, consisting of at least 50% from the ranks
Security Management The Company implemented its strict security measures to safeguard Thaioil Group’s personnel, properties, data, and reputation from security threats arising from internal and external factors in line with risk levels. It adheres to Thaioil Group’s policy on quality, security, safety, occupational health, environment, energy, and social responsibility, which requires the management and employees to jointly and strictly conform to the Universal Declaration of Human Rights. This year it took the following steps further:
of operating personnel (excluding the Chairman). This panel meets at least once a month to keep employees informed, track performance, and share future plans. Thaioil constantly develops and upgrades its management system for occupational health, safety, and fire prevention and firefighting through work process improvement for maximum efficiency in its management systems and work processes, thus giving rise to operational excellence. In addition, moves are made to strengthen leadership excellence and skills on occupational health, safety, and
>> Devised and reviewed security measures for threats,
emergency and crisis management through various personnel
while linking the measures and resources to public and
competency development programs to underscore the
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P roduct i o n P ro ces s es a n d P r o c e s s D e v e lo p m e n t / Qua l i t y, S ecuri t y, S a fe ty, H e a lth , a n d E n v ir o n m e n ta l M a n a g e me n t
ANNUAL REPORT 2014
importance of and cultivate safety as a corporate culture
issue. Regarding the community’s role as its operation
among employees, while warding off potentially severe
licensor (License to Operate), the Company has focused
incidents.
on proactive environmental management or preventive measures at source. Also, the Company has constantly
The Company took the following steps in occupational campaigned and promoted of 3Rs (Reuse, Reduce, health this year: Recycle) awareness. 1. Contractor Safety Management Thaioil devised a strategy called Safe White Green for contractors’ participation in the management of Safe, Secure (White), and the Environment (Green), the ultimate
2. Safety Leadership Thaioil focuses on developing and elevating individual awareness of leadership leading eventually to a corporate safety culture.
of which is zero accident, no narcotics or unlawful acts, and zero impact on the environment or nuisance on communities.
>> T h e m a n a g e m e n t c a l l s o n o p e r a t o r s i n a w e e k l y Management Walk and Talk, focusing on boosting
>> SAFE : Focus on SSHE awareness and work safety
workers’ morale while stressing the Safe White Green
leadership through the Safety Leadership (one of the plans
policy and sharing/monitoring issues and obstacles to
under the Quality Management Occupational Health and
work safety.
Safety (QMOS) 5-Year Roadmap), defined as a plan under the Safety Leadership Initiative Charter. Regular
>> A Voice of Safety article educates employees and contractors through daily internal broadcast at 1 p.m.
monitoring and review of effectiveness are in place.
>> Potential Incident Reports (PIRs) are prepared with a >> WHITE : Thaioil defined the policy and requirements for contractors to take part in early training, campaigns,
focus on unsafe practices leading to improvement before accidents do happen.
vigilance, and screening of contractors’ use of narcotics. The prevention of narcotics is in place through the Security Awareness Project. Additional preventive measures were also defined in cooperation with local government agencies
>> A Toolbox Talk addresses safety issues, participated by supervisors, employees and contractors at work sites before each day’s work.
to constantly and randomly conduct urine tests. New
>> Safety information and lessons learned from past work
narcotics-takers will prove themselves by entering a
accidents, in and outside Thaioil are relayed through the
narcotics program to reduce and give up drugs. Those
QSHE Newsletter and the Akanee journal to promote
with repeated detections will be prohibited from working
learning and sharing of experiences leading to awareness
for Thaioil Group for good and turned in to the authority for
and work safety leadership.
indictment. Incidentally, such cases have not happened.
3. Occupational Health
>> GREEN : While there have not yet been issues or obstacles
The Company introduced the assessment of risk factors
concerning the refinery’s community impacts leading to
concerning ergonomics approaches for office work to new
complaints, Thaioil has nevertheless valued this potential
employees working at office buildings by:
051
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
Prod u c t i on Proc e sse s an d Proc e ss Development / Qu al i t y, Se c u ri t y, Safe t y, He al t h , an d E n vi ron m e n t al Management
>> Expanding communication channels >> Training and staging a Table-Top Exercise for the response
HEALTHY SAFETY ENT ENVIRONMENT Thaioil constantly develops and upgrades its management system for occupational health, safety, and fire prevention and firefighting through work process improvement and various personnel competency development programs, for maximum efficiency, to underscore the importance of and cultivate safety as a corporate culture.
team to review roles and test the preparedness of emergency plans and communication networks before their roll-outs. Environmental Management Leveraging its strengths and skills in energy matters accrued over five decades, Thaioil Group has defined an environmental management framework with due regard for the Triple Bottom Lines (Social, Environmental, and Economic) under the Environmental Master Plan for
>> Reviewing the current manual of diagnosing and reporting of work-related injuries and pertinent procedures
2012-2016 to respond to challenges and opportunities posed by major stakeholders, including communities, operation licensors, group business plans, and guidelines
>> Developing a Fit for Work manual >> Assessing ergonomic risk factors for those working in
for environmental excellence practices. Nine development project plans make up its environmental management:
offices and providing individual recommendations 1. Governance Structure
>> Monitoring and reporting on last year’s ergonomic risk factor assessment outcomes.
All along, ISO 14001 has governed the oversight and development of Thaioil’s environmental management system.
4. Emergency and Crisis Management
Today, Global Reporting Initiative (GRI) and Dow Jones
This year was one of integration of emergency plans based
Sustainability Indices (DJSI) provide an operational approach
on a study of the emergency response team, by:
for a wider, more comprehensive scope and issues. As for CSR standards, ISO 26000 has been applied under the
>> Assessing the pros and cons of such integration and the
CSR-DIW project.
response team
>> Reviewing emergency plans and structures, along with the roles of the response team
>> Reviewing communication networks among various centers and commands
2. Technical Procedures Thaioil ensures that its environmental management agrees with the code of conduct for its treatment of communities, society, and the environment. It will engage in no activities that harm natural resources and the surroundings and will
>> Purchasing new firefighting apparatus to replace expired ones
>> Purchasing 80,000 liters of new foam extinguishing solution
constantly cultivate awareness of social and environmental responsibility among employees. To this end, it has defined corporate governance in its policy on quality, security, safety, occupational health, environment, and social
052
THAI OIL PUBLIC COMPANY LIMITED
P roduct i o n P ro ces s es a n d P r o c e s s D e v e lo p m e n t / Qua l i t y, S ecuri t y, S a fe ty, H e a lth , a n d E n v ir o n m e n ta l M a n a g e me n t
ANNUAL REPORT 2014
responsibility, which has found implementation and has
5. Eco-Efficiency Performance
been communicated through various means, including
Besides environmental stewardship and conformance to
CG e-lear ning, employee orientation, education and
measures to prevent and ease environmental impacts
training on environmental aspects, Safety, Security and
defined in the Environmental Impact Assessment (EIA)
Environment in Refinery (STA.1) training, QSSHE Week
reports, together with full conformance to environmental
activities, training on environmental courses, and internal
legislation, Thaioil Group takes the following process
and external energy and environmental conservation training.
improvement into account to illustrate its attention to
Thaioil drives its employees toward implementation while
environmental quality:
informing them as required by ISO 14001. Through the years,
>> Air Pollution – The management process ranges from
its environmental management has constantly pursued
design, maintenance planning, control of the sulfur content
excellence and can be passed on from generation to generation
in fuels at its sources, choice of equipment and clean
via the steps under Knowledge Management known as
processes, ventilation control, to continual measurement
COSSAI: Capture, Organize, Store, Share, Apply, and Innovate.
>> Water Pollution – Water pollution management ranges from volumetric reduction and segregation of treatment from
3. Climate Strategy Valuing natural resource conservation (particularly that of
sources, the 3Rs principles (Reduce, Reuse, Recycle), to efficient wastewater treatment
fuels and energy), Thaioil Group appointed an Energy and
>> Industrial Waste – To manage industrial waste, the process
Loss Committee (E&L) to plan operation, monitor, examine,
involves inventory-preparation, volumetric reduction at
and identify ways to constantly improve energy management.
sources using the 3Rs principle, storage control, transport,
Besides, the Company has defined a master plan for energy
as well as safe, lawful, and technically correct disposal
management for 2010-2019, with a goal to move into the
for treatment.
first quartile of Asia-Pacific refineries in energy consumption, which directly affects the atmosphere through greenhouse gas reduction.
6. Biodiversity As a responsible party for the habitats and natural resources around the refinery, Thaioil Group constantly operates
4. Water Resource Management Thaioil has in place a systematic water resource management to lower risks for water shortage in the production process
under the findings of the EIA project by defining measures to constantly monitor environmental impacts. 7. Supplier and Contractor Program
and prevent possible conflicts with communities. It is also
A crucial factor for Thaioil’s sustainability is its management
prepared to publicize its water consumption and welcomes
of business partners and contractors, which also illustrates
inspection. To raise water management efficiency, it mapped
social responsibility for managing impacts on society and the
out a development framework intended for dealing with water
environment from their operation. As a result, it has defined
consumption in the production process and efficient use of
guidelines for business partners and contractors concerning
water resources. Project design is underway.
the environment and society and encouraged them to
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THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
Prod u c t i on Proc e sse s an d Proc e ss Development / Qu al i t y, Se c u ri t y, Safe t y, He al t h , an d E n vi ron m e n t al Management
conform to Thaioil Group’s requirements. Thaioil has also
developing curricula focusing on valuing environmental policy
joined the CSR-DIW Project to show its social responsibility.
communication and employee education from day one (that is, through their orientation), particularly operators, technicians,
8. Environmental Audit Because of the earnest, continual operation under the ISO 14001 framework, Thaioil has sustained no major corrective action (meaning NC Major = 0) following an audit by the Management System Certification Institute (Thailand). In addition, it is defining audit and assurance actions for its sustainability development reports under the Global Reporting Initiative (GRI).
and engineers, who are performing tasks directly related to environmental stewardship and conservation. Such courses include STA.1 (Safety, Security and Environment in Refinery), QSSHE Week activities, external and internal training on environmental courses, and training for managers, supervisors, and operators responsible for water pollution, industrial waste, and air pollution control. Moreover, engineers who are in charge of production
9. Management Information Solutions
processes were sent to technology proprietors for training on
For sustainable management, Thaioil Group is developing
process techniques. More than 20 such courses were held.
and formatting its environmental database to strive for inter national management practices, with instances including an environmental dashboard, LCA/LCI, carbon dioxide footprint, and water footprint.
In addition, Thaioil has applied leading environmental management systems and other management systems, including ISO 14001 and ISO 26001 through the CSR-DIW Project. Besides, it regularly encourages employees’ environmental conservation awareness through the likes
The work under the Environmental Master Plan of 2012-2016 of environmental audit in production areas and campaigns is annually revised under management reviews, leading to on the effective application of office resources—including annual process improvement, which is a key element switching off meeting room lights after meetings, properly supporting the vision and mission of commitment to controlling air conditioners’ thermostats in offices, saving social responsibility. The work also fosters satisfaction and tap water, and using electronic instead of hard document engagement among stakeholders, leading to Thaioil Group’s copies in communication. sustainable growth. The outcomes of these various activities are regularly Environmental Education and Training for Employees
reported to the management, who conduct their annual
Thaioil has defined a code of conduct for the treatment of
Management Review to outline improvement guidelines
communities, society, and the environment, under which it
and formulate the annual plans, to be deployed for effective
refrains from harming natural resources and the surroundings,
implementation.
and will constantly cultivate awareness of social and environmental responsibility among its workforce. To this end, it has defined a clear set of guidelines for the education and training of employees on environmental conservation. A Quality Management unit is in charged of designing and
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THAI OIL PUBLIC COMPANY LIMITED
Fut ure P ro j ect s
12
ANNUAL REPORT 2014
FUTURE PROJECTS Thaioil Group’s strategic investment plan is designed to establish sustainable business growth to become a leading i n t e g r a t e d re f i n i n g a n d p e t ro c h e m i c a l c o m p a n y i n Asia-Pacific, an advantage when the market becomes broadened and is full of investment and business opportunities under the ASEAN Economic Community (AEC) integration. The investment plan focuses on value-added creation from existing products, new products to meet market demand, capacity expansion, efficiency improvement investment, and investment for competitiveness. Business development activities such as delivery of petroleum and petrochemical products, logistics services, overseas business expansion, and business model adjustment to cope with market changes exemplify Thaioil’s investment plan to optimize profits.
Ongoing Projects To become a business leader in the integrated refining and petrochemical company in Asia – Pacific and prepare for the ASEAN Economic Company (AEC)
LAB Production by Thai Paraxylene (TPX) Thai Paraxylene Co., Ltd. (TPX) and Mitsui & Company Co., Ltd. under a 75:25 ownership structure, jointly founded LABIX Co., Ltd., (LABIX) on July 11, 2013, a pioneer producer of LAB (Linear Alkyl Benzene) in Thailand with production capacity of 100,000 tons per annum. Benzene and kerosene from Thaioil are the main raw materials for LAB, surfactant for detergents. The state-of-the-art and environmentally friendly production technology from UOP Limited Liability Company was selected, the plan of which would be directly connected to Thaioil’s main facilities to optimize operation efficiency and business competitive advantage. The project investment is Baht 12 billion. Production of LAB would displace 72,000 tons per annum of imports. LABIX could export the remaining products to other markets in Southeast Asia a net importer. Presently,
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THAI OIL PUBLIC COMPANY LIMITED
Future Projects
ANNUAL REPORT 2014
1. Efficiency Improvement Project on the delivery of jet fuels and paraxylene. The project focus is on the modification of a pipeline system to increase the distribution channels of jet fuels to the distribution station of Chonburi Terminal Company and paraxylene to PTT’s Sriracha Petroleum Terminal to offload to 10,000-ton cargo ships. The project seeks to increase the distribution flexibility of products and reduce shipment costs. The total project cost is Baht 172 million. The project completion is scheduled for 2015 for jet fuel delivery and 2016 for paraxylene delivery. 2. Product Distribution Station Expansion Project seeks to increase delivery by truck from 10 to 15 million liters per day so as to meet increasing market demand and increase efficiency and flexibility of the distribution of its there is only one LAB production plant in the region, which is not sufficient for the increasing needs in order to cope with economic growth. Thaioil is fully confident that the LAB project would put Thailand to become the LAB production and distribution center is Southeast Asia.
petroleum products. The project, at an investment of Baht 1.84 billion, is estimated to be completed by 2016. Cogeneration Plant Construction (New SPP) Thaioil has strategy to diversify risks from the fluctuating refining / petrochemical business to power business, which
The LABIX Project construction is 80% completed and
is very cyclical in returns. Thaioil could also provide security
scheduled for completion and commission in 2015, in time
for electricity and steam supply to Thaioil Group. In 2011,
for the AEC integration.
Thaioil was selected to run two-Small Power Plant (SPP) with 90 MW power capacity each. The total project cost
Sriracha Logistics Development is approximately Baht 12 billion. The transport and logistics system development project, to be jointly invested by Thaioil and PTT Plc. is a combination of two sub-projects as follows:
The project is under construction, with 40% completed. Commercial production dates are set for April 1, 2016, for the first project and June 1, 2016, for the second project.
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THAI OIL PUBLIC COMPANY LIMITED
Fut ure P ro j ect s
ANNUAL REPORT 2014
Biogas Generation Project from Dried Cassava Pulp by
Projects under Feasibility Studies
NP Bio Energy
Oil Residue Value-Added Project
NP Bio Energy Co., Ltd., was founded by Ubon Bio Ethanol
Following the spiraling demand for refined products for
Co., Ltd., to generate biogas from dried cassava pulp,
transport and petrochemical products as a result of
residue from ethanol production of Ubon Bio Ethanol and
economic growth of Thailand and the region, Thaioil initiated
from tapioca starch production of Ubon Agricultural Energy
a feasibility study to create value from oil residue (low-value
Co., Ltd. The pulp fuels steam generation for ethanol
fuel oil) by refining it to generate higher-value products.
production and for hot-air ovens in tapioca starch production.
The scope covers detailed studies of the installation of
The ongoing project is set for completion in Q2/2015.
a modern cracking unit and other technologies enabling higher-quality products. The study could also provide
In addition, NP Bio Energy plans to participate in the Very
improvement opportunities for existing production processes.
Small Power Producer (VSPP) program under the 5 - 6 MW
A preliminary feasibility study has been completed, and
power plant category. Thanks to adder pricing incentives,
the project is now at the conceptual engineering design
VSPP can also deliver power generated from biogas to
stage.
Provincial Electricity Authority (PEA)’s grid. Solvent Business Expansion Thaioil Marine’s Fleet Expansion
Under its commitment to become Asia-Pacific’s leader in the
With a vision to become a fleet leader for PTT Group and in
solvent business and since the completion of Sak Chaisidhi’s
Asia-Pacific to support the growth in energy and petroleum /
solvent capacity expansion in 2014 to become the largest
petrochemical market. Thaioil Marine focuses on the
d o m e s t i c s o l v e n t p ro d u c e r i n T h a i l a n d . T h a i o i l h a s
expansion of its large-vessel fleet, by investing in VLCC
continuously pursued its technological development in
and AFRAMAX, to support shipment of petroleum and
solvent with a focus on niche products and environmentally
petrochemical products, as well as its small-vessel fleet,
friendly products. Market expansion to other AEC members
including crew boats to support logistics services and in
with high economic growth is on plan.
preparation for the AEC integration. This growth strategy is also aimed for stepping out to overseas.
Slack Wax Production in Indonesia Since the completion of the Indonesian business opportunity
Thaioil Marine continues to pursue this growth strategy
study, Thaioil has developed business partnership with
in 2015, with investment on procuring additional vessels
Pertamina Persero, the national oil company of Indonesia,
to increase its fleet potential to support the logistics and
to create more value from the slack wax from refinery unit #4
shipment of oil and natural gas for Thaioil Group and PTT
in the regency of Cilacap. The output product is hard wax,
Group for national energy security.
a paraffin-based wax, used as a raw material for batik,
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THAI OIL PUBLIC COMPANY LIMITED
Future Projects
ANNUAL REPORT 2014
candle, furniture and others. A conceptual design has been
of Myanmar. The selection process is ongoing, with the
completed, and the project is now under detailed assessment
selection outcome anticipated in Q1/2015.
for final investment decision. The investment size for the Thanlyin Refinery modernization Thanlyin Refinery Modernization in Myanmar
may be insignificant; however, it is a crucial stepping stone
Thaioil submitted a modernization proposal for Thanlyin
in Thaioil’s strategic plan to enter a sizeable market and
Refinery to the oil refining business unit of the Myanmar
investment opportunities in Myanmar. Success could lead
government. With a competitive advantage in oil refining
to refining capacity expansion, investment in a new refinery,
business, the proposal was developed to seek business
or other related energy businesses.
opportunities there to produce a variety of oil products to meet the rapidly growing demand after the recent opening up of the country to the world. Thanlyin Refinery is located near Yangon, Myanmar’s economic center and largest oil refined product market, with a refining capacity of 20,000 barrels per day.
Other Business Opportunities It is essential for Thaioil to strengthen its organizational capability to be able to compete with others, expand their businesses, and capture new business opportunities in the current business environment. Business expansion within and outside the country is vital. Through new business
The rationales for this investment proposal include market
partnership and mergers and acquisitions (M&As), Thaioil
expansion opportunities and the application of Thaioil’s
would be able to generate value-added businesses and
competitive advantages. The market growth potential in
create new businesses by leveraging the knowledge and
Myanmar is sizeable, and oil refining is a business in which
skills, as well as its long-term experience, of the Thaioil Group
Thaioil is extremely knowledgeable and skillful. The proposal
to become a future sustainable business leader.
was put up in conjunction with PTT Plc. to the state authority
058
THAI OIL PUBLIC COMPANY LIMITED
Org a ni za t i o na l E ffect i v e n e s s M a n a g e m e n t
13
ANNUAL REPORT 2014
ORGANIZATIONAL EFFECTIVENESS MANAGEMENT
POTE NT IA L O F S TA F F POTE NT IA L O F T H A IO IL Thaioil believes in the quality of staff and aims to develop their ability to create unlimited potential through HR Model, which lays the foundation of its Human Resources direction, policy, and practices. When designing an HR system, the company takes into consideration its structure and need for manpower, the system capacity to support the strategy to expand business abroad, and the satisfaction of staff. This is to secure and proudly ensure the company recognition among staff as Employer of Choice with the quality of the Best Employer.
Human Resources Development It is because of Thaioil Group’s faith in employee quality that
a p p ro a c h f o r e a c h c o m p e t e n c y. A s f o r m a n p o w e r
short-term and long-term successes of corporate strategy
preparedness, the Company constantly reviewed its
implementation have been scored against plans. The Company
organizational structure to ensure compatibility with
focuses on and values human resources preparedness in
the Group’s strategies and plans, while clearly defining
competencies and manpower requirements that efficiently
manpower needs of each unit—leading to appropriate
align with its needs for excellence, accommodating the
career management and recruitment of new staff.
Group’s sustainable growth. This year, the Company came up with an HR Model, a basis for the Group’s systematic HR approaches, policies, and guidelines for human resources in a systematic way, with clear linkage to corporate policies and strategies.
For succession planning, the Company completely assessed the readiness of successors at the management level to define their individual development plans. It has also executed more than 90% of the succession plans and completed a review of the annual succession plans. In addition, the Company
By developing all employees under the Group’s Development
has developed a talent management system focusing on
Journey, Thaioil elevated employees’ preparedness to
development and retention of high-flyers through assorted
ensure their readiness in current positions and future
processes like special-project assignments and development
c a re e r p a t h s . I t re v i e w e d a n d a d j u s t e d f u n c t i o n a l
for their maximum career growth in support of the Company’s
competencies in line with prevailing organizational structure
sustainable growth. Thaioil also focused on employees’
and work scopes, and defined a clearer development
loyalty to itself, beginning with their career with Thaioil,
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THAI OIL PUBLIC COMPANY LIMITED
Organ i zat i on al E ffe c t i ve n e ss Management
ANNUAL REPORT 2014
through the Employee Engagement Program, the mentor/
POSITIVE values), and Performance Management System
coaching system (for guidance on work and life at Thaioil
Execution (PMS Execution, encouraging employee to
Group), the brotherly work ambience, promotion of
participate in the performance assessment process, from
the POSITIVE culture in the Company, and various corporate
goal setting to staff performance report reading on two – way
and supporting unit activities in support of employee
communication – the practice of which is aimed for 100
engagement.
percent through all the Company.)
To accommodate international business growth under the
To underscore the success of the Organizational Health
Group’s growth strategic plan, the Company developed an
Development Project, the Company conducted a full - fledged
International HR System that encompasses every element of
Organizational Health Index Survey (OHI Survey) again in
human resources administration and development, in which
November 2014. It was then found that all nine components
policy frameworks and guidelines are clearly defined, as are
of OHI—namely organizational directions, leadership, culture
overseas packages. The company also developed a mobility
and values, responsibilities, coordination and control,
pool by designing assessment methods and development
organizational capacity, inspiration, external relations,
solutions for international assignment readiness.
innovations, and learning—were in the Top Quartile against the global benchmark. In short, this truly illustrated Thaioil’s
Thaioil Group’s employee engagement survey outcomes form the input to a plan to pinpoint opportunities to constantly improve employees’ satisfaction and engagement. The Company also looked into details of how to become an Employer of Choice on its way to become The Best Employer, an element of the approach to becoming a sustainable organization.
Organizational Health Check It is vital that a growing organization must be healthy in order to survive in a sustainable way. The Company has paid serious attention to the nurturing of organizational health and defined it as a key strategy in 2014, with a continued organizational health development project. This year, all Thaioil Group employees and the management together improved and promoted corporate immunity through three projects originating from employees’ ideas: One Team One Pride (OTOP, focusing on internal activities that employees want to jointly develop), Trust and Care (driving for the workforce to trust and care for one another under the
intrinsic strengths.
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THAI OIL PUBLIC COMPANY LIMITED
Boa rd o f D i rect o rs
14
ANNUAL REPORT 2014
BOARD OF DIRECTORS
Mr. Kurujit Nakornthap Director (Non-Executive) (Appointed on September 12, 2014) and Chairman of the Board (Elected on September 26, 2014) Age 59 Yrs.
Education >> B.Sc. (with Special Distinction) in Petroleum Engineering, University of Oklahoma, U.S.A. >> M.S. in Petroleum Engineering, University of Oklahoma, U.S.A. >> Ph.D. in Petroleum Engineering, University of Oklahoma, U.S.A. Training for the Directors Courses of Thai Institute of Directors Association (IOD) Director Accreditation Program (DAP 64/2007) >> Audit Committee Program (ACP 32/2010) >> Role of Compensation Committee (RCC 12/2011) >>
Other Training National Defense Course (NDC), Class 51, Thailand National Defence College >> Top Executive Program in Commerce and Trade (TEPCoT 3), Commerce Academy, University of the Thai Chamber of Commerce >> Executive Program, Advanced Administrative Justice, Class 2, Institute of Administrative Justice Development >> Executive Program, Capital Market Academy (CMA), Class 13 >> Executive Program, Energy Education, Class 1, Thailand Energy Academy >> Executive Program, Poompalungpandin, Class 2, Chulalongkorn University >>
Working Experience in the 5 preceding years 2008 - 2010 Director General, Department of Mineral Fuels, Ministry of Energy 2010 – Jul. 2014 Deputy Permanent Secretary, Ministry of Energy Jul. – Sep. 2014 Director General, Department of Mineral Fuels, Ministry of Energy Oct. 2014 – Present Deputy Permanent Secretary, Ministry of Energy
Other Positions 1. Listed Company (2) >> Chairman of the Board, Ratchaburi Electricity Generating Holding Public Company Limited >> Chairman of the Board, the Enterprise Risk Management Committee, PTT Public Company 2. Public Company 3. Limited Company 4. Other Organizations / Institutions 5. State Enterprise
Limited - None - None - None - None
% of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
None None None None
061
THAI OIL PUBLIC COMPANY LIMITED
Board of Directors
ANNUAL REPORT 2014
Mr. Chulasingh Vasantasingh gh Director (Non-Executive) (Appointed on November 29, 2013)) mittee and Chairman of the Audit Committee (Elected on May 8, 2014) Age 64 Yrs.
Education >> Bachelor of Laws (LLB.) (Hons.), Chulalongkorn University >> Barrister at Law, The Institution of Legal Education >> Master of Comparative Law (MCL.), University of IIIinois, U.S.A. >> Honorary Doctorate Degree in Laws, Ramkhamhaeng University >> Honorary Doctorate Degree in Laws, Chulalongkorn University >> Honorary Doctorate Degree in Laws, Yonok University >> Harvard Business School Certificate Training for the Directors Courses of Thai Institute of Directors Association (IOD) >> Director Certification Program (DCP 35/2003) >> Finance for Non-Finance Director (FND 7/2003) >> Understanding the Fundamental of Financial Statements (UFS 1/2006) >> Audit Committee Program (ACP 17/ 2007) >> DCP Refresher Course (2008) >> Financial Institutions Governance Program (FGP 4/2012) Other Training >> National Defense Course (NDC), Class 388, Thailand National Defence College >> Executive Program, Politics and Governance in Democratic Systems, Class 8, the College of Politics and Governance, King Prajadhipok’s Institute >> Executive Program, Capital Market Academy (CMA), Class 5 >> Executive Program, Energy Education, Class 1, Thailand Energy Academy >> Top Executive Program in Commerce and Trade (TEPCoT 5), Commerce Academy, University of the Thai Chamber of Commerce >> Executive Program, Poompalungpandin, Class 1, Chulalongkorn University Working Experience in the 5 preceding years 2005 - 2009 Deputy Attorney General, Office of the Attorney General 2009 - 2013 Attorney General, Office of the Attorney General 2010 - 2013 Independent Director / Chairman of the Audit Committee, PTT Public Company Limited 2010 - 2013 Independent Director / Chairman of the Audit Committee, Thai Airways Public Company Limited 2013 - 2014 Independent Director / Chairman of the Audit Committee, Krung Thai Bank Public Company Limited 2011 - Present President, Chulalongkorn University Alumni Association under the Patronage of His Majesty the King
Other Positions 1. Listed Company 2. Public Company (4) >> Independent Director / Chairman of the Nominating Committee, Glower Power Synergy Public Company Limited >> Independent Director / Chairman of the Board, Aqua Corporation Public Company Limited >> Director, TPI Polene Public Company Limited >> Independent Director / Chairman of the Audit Committee, Thanachart Insurance Company Limited 3. Limited Company 4. Other Organizations / Institutions (5) >> President, Chulalongkorn University Alumni Association >> Professor, Chulalongkorn University >> Member of Chulalongkorn University Council >> Member of the Council of State >> Director of Property Management, Chulalongkorn University 5. State Enterprise % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
- None
- None
- None -
None None None None
062
THAI OIL PUBLIC COMPANY LIMITED
Boa rd o f D i rect o rs
ANNUAL REPORT 2014
Ms. Chularat Suteethorn
Mr. Suvit Maesincee Mr
Independent Director (Non-Executive) utive) 3) (Appointed on September 20, 2013) ttee and Member of the Audit Committee 3) (Appointed on September 20, 2013) Age 60 Yrs.
Ind Independent Director (Non-Executive) ive) (Ap (Appointed on September 12, 2014) and Member of the Audit Committee ee (Ap (Appointed on September 26, 2014) Age 53 Yrs.
Education Bachelor of Economics (Hons.), Kasetsart University >> Master of International Development (Economic Policy and Planning), Institute of Social Studies, Rotterdam Erasmus University, the Netherlands
Education >> B.Sc. in Pharmacy, Faculty of Pharmacy, Mahidol University >> MBA in Marketing, School of Business Administration, National Institute of Development Administration >> Ph.D. of Marketing, Kellogg Graduate School of Management, Northwestern University, U.S.A.
>>
Training for the Directors Courses of Thai Institute of Directors Association (IOD Director Accreditation Program (DAP 40/2005) >> Director Certification Program (DCP 72/2006) >> Finance for Non-Finance Director (FND 28/2006) >> Financial Statements for Director (FSD 10/2010) >> Audit Committee Program (ACP 39/2012) >> The Role of Chairman Program (RCP 28/2012) >> Financial Institutions Governance Program (FGP 4/2012) >> Role of the Nomination and Governance Committee (RNG 3/ 2012) >> Anti-Corruption for Executive Program (ACEP 10/2104) >> Advanced Audit Committee Program (AACP 15/2014) >>
Other Training Executive Development Program, Class 41, Office of the Civil Service Commission >> Strategic Thinking and Executive Action, Kellogg Executive Program, Northwestern University, U.S.A. >> The Joint State-Private Course, Class 19, Thailand National Defence College >> Advanced Security Management Program (ASMP), Class 1, the Association National Defence College of Thailand >> Executive Program, Capital Market Academy (CMA), Class 12 >> Top Executive Program in Commerce and Trade (TEPCoT 5), Commerce Academy, University of the Thai Chamber of Commerce >> Executive Program, Energy Education, Class 3, Thailand Energy Academy >> Thammasat Leadership Program (TLP), Class 4, Thammasat University >>
Working Experience in the 5 preceding years 2007 - 2009 Alternate Executive Director, the World Bank and Affiliates, Washington D.C., U.S.A. 2009 Deputy Director General, Fiscal Policy Office, Ministry of Finance 2009 - 2011 Fiscal Policy Advisor, Fiscal Policy Office, Ministry of Finance 2011 - 2012 Inspector General, Office of Permanent Secretary, Ministry of Finance 2012 - 2014 Director General, Public Debt Management Office, Ministry of Finance Other Positions 1. Listed Company 2. Public Company 3. Limited Company 4. Other Organizations / Institutions (1) >> Vice Minister for Finance 5. State Enterprise % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
- None - None - None
- None -
None None None None
Training for the Directors Courses of Thai Institute of Directors Association (IOD) Director Certification Program (DCP 12/2002) >> Director Accreditation Program (DAP 60/2006) >> Audit Committee Program (ACP 37/2011) >> DCP Refresher Course (2006) >>
Other Training
- None
Working Experience in the 5 preceding years 2008 - Present Director of Sasin Institute for Global Affairs (SIGA) Sasin, Graduate Institute of Business Administration of Chulalongkorn University 2008 - Present Independent Director / Member of the Audit Committee Berli Jucker Public Company Limited 2009 - Present Member of Nomination and Remuneration Committee, Berli Jucker Public Company Limited 2011 - Apr. 2014 Independent Director / Member of the Audit Committee, Krungthai Card Public Company Limited Jul. 2011 - Present Independent Director / Member of the Audit Committee, Siam Food Products Public Company Limited 2011 - Present Independent Director / Member of the Audit Committee, G Capital Public Company Limited Other Positions 1. Listed Company (4) >> Independent Director/ Member of the Audit Committee, Thai Vegetable Oil Public Company Limited >> Independent Director / Member of the Audit Committee / Member of the Nomination and Remuneration Committee, Berli Jucker Public Company Limited >> Independent Director/ Member of the Audit Committee, Siam Food Products Public Company Limited >> Independent Director/ Member of the Audit Committee, G Capital Public Company Limited 2. Public Company 3. Limited Company 4. Other Organizations / Institutions (1) >> Member of the National Reform Council 5. State Enterprise % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
- None - None
- None -
None None None None
063
THAI OIL PUBLIC COMPANY LIMITED
Board of Directors
ANNUAL REPORT 2014
Gen. Jiradej Mokkhasmit
Mr. Nuttachat Charuchinda
Independent Director (Non-Executive) ive) (Re-elected on April 2, 2013) and Chairman of the Nomination and Remuneration Committee (Elected on April 10, 2014) Age 60 Yrs.
Director (Non-Executive) (Re-elected on April 2, 2013) and Member of the Nomination and Remuneration Committee (Appointed on January 24, 2014) Age 60 Yrs.
Education >> Bachelor of Science, Chulachomklao Royal Military Academy, Class 24 >> National Defence College
Education >> Bachelor of Engineering, Chiangmai University >> Master of Business Administration, Thammasat University
Training for the Directors Courses of Thai Institute of Directors Association (IOD) Director Accreditation Program (DAP 16/2004)
Training for the Directors Courses of Thai Institute of Directors Association (IOD) >> Director Certification Program (DCP 129/2010)
Other Training Colonel Program, Australia >> Fort Benning, U.S.A.
Other Training >> Program for Global Leadership (PGL), Harvard Business School, U.S.A. >> Oxford Energy Seminar, England >> Break through Program for Senior Executives (BPSE), IMD International, Switzerland >> The Joint State-Private Course, Class 20, Thailand National Defence College >> Executive Program, Capital Market Academy (CMA), Class 15 >> Executive Program, Energy Education, Class 3, Thailand Energy Academy
>>
>>
Working Experience in the 5 preceding years 2008 Deputy Commander, 1st Army Area 2009 Commander, 1st Army Corps 2010 Deputy Chief of Staff, Royal Thai Army 2012 Assistant Commander in Chief, Thai Royal Army 2013-2014 Chairman of the Advisory Board, Royal Thai Army Present Member of the National Legislative Assembly Other Positions 1. Listed Company (1) >> Independent Director / Chairman of Audit Committee, Mida Leasing Public Company Limited 2. Public Company 3. Limited Company 4. Other Organizations / Institutions (1) >> Chairman of the Advisory Board, Royal Thai Army 5. State Enterprise % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
- None - None
- None -
None None None None
Working Experience in the 5 preceding years 2005 - 2009 Executive Vice President, Natural Gas Vehicle, PTT Plc. 2009 Executive Vice President, International Trading Business Unit, PTT Plc. 2010 - 2011 Senior Executive Vice President, Corporate Strategy, PTT Plc. 2011 - 2013 Chief Operating Officer, Downstream Petroleum Business Group, PTT Plc. Other Positions 1. Listed Company (2) >> Chief Operating Officer, Upstream Petroleum and Gas Business Group, PTT Plc. >> Director, PTT Exploration and Production Public Company Limited 2. Public Company - None 3. Limited Company (1) >> Director, PTT Energy Resources Company Limited 4. Other Organizations / Institutions (3) >> Chairman of the Board, Water Resource Management Committee, Thailand Business Council for Sustainable Development >> Chairman of the Board, PTT Volunteer Club >> Chairman of the Board, PTT Fun run Club 5. State Enterprise - None % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
None None None None
064
THAI OIL PUBLIC COMPANY LIMITED
Boa rd o f D i rect o rs
ANNUAL REPORT 2014
Mr. Thaworn Phanichaphan
Professor Dr. Thosaporn Sirisumphand Pr sumphand
Independent Director (Non-Executive) utive) (Appointed on November 29, 2013) and Member of the Nomination and Remuneration Committee (Appointed on April 25, 2014) Age 64 Yrs.
Ind Independent Director (Non-Executive), tive), (Ap (Appointed on May 25, 2012) Ch Chairman of the Co e, Corporate Governance Committee, (Ele (Elected on August 31, 2013) an and Member of Nomination an and Remuneration Committee (Ap (Appointed September 26, 2014) Ag Age 54 Yrs.
Education >> Bachelor of Laws (LL.B.) (Hons.), Chulalongkorn University >> Barrister at Law, The Institution of Legal Education >> Master of Laws, Chulalongkorn University
Education >> Bachelor of Public Administration (Hons.), Chulalongkorn University >> Master of Public Administration, Pi Alpha Alpha (National Honor Society for Public Affairs and Administration), Northern Illinois University, U.S.A. >> Ph.D. in Policy Analysis, Public Administration, and Comparative Politics, Northern Illinois University, U.S.A.
Training for the Directors Courses of Thai Institute of Directors Association (IOD) Understanding the Fundamental of Financial Statements (UFS 8/2007) >> Director Certification Program (DCP 108/2008) >> Director Accreditation Program (DAP 73/2008) >> Audit Committee Program (ACP 22/2008) >>
Other Training National Defense Course (NDC), Class 4313, Thailand National Defence College >> Executive Program, Politics and Governance in Democratic Systems, Class 14, the College of Politics and Governance, King Prajadhipok’s Institute >>
Working Experience in the 5 preceding years 2007 - 2013 Deputy Attorney General 2010 - Present Board of Committee, Financial Institutions Development Fund 2010 - Present (Legal) Expert Board of Committee, Deposit Protection Agency 2011 - Present Expert Board of Committee, Anti – Money Laundering Office Present Senior Public Prosecutor Other Positions 1. Listed Company 2. Public Company 3. Limited Company 4. Other Organizations / Institutions (4) >> Senior Public Prosecutor >> Expert Board of Committee, Anti – Money Laundering Office >> Board of Committee, Financial Institutions Development Fund >> (Legal) Expert Board of Committee, Deposit Protection Agency 5. State Enterprise
- None
% of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
- None - None - None
None None None None
Training for the Director Courses of Thai Institute of Directors Association (IOD) Director Certification Program (DCP 80/2006) >> Finance for Non-Financial Director (FND 30/2006) >>
Other Training Courses Executive Program, Capital Market Academy (CMA), Class 10 >> Executive Program, Advanced Justice Process, Class 15, Judicial Training Institute >> Executive Program, Energy Education, Class 4, Thailand Energy Academy >> Corporate Governance: Effectiveness and Accountability in the Boardroom, Kellogg School of Management, Northwestern University, U.S.A. >>
Working Experiences in the 5 preceding years 2012 - 2013 Independent Director, Siam Commercial Bank Public Company Limited 2013 - 2014 Independent Director / Chairman of the Corporate Governance Committee, PTT Public Company Limited 2013 - 2014 Independent Director / Chairman of the Corporate Governance and Social Responsibility Committee, CAT Telecom Public Company Limited 2002 - 2013 Secretary General, Office of the Public Sector Development Commission 2013 - 2014 Secretary General, Office of the Higher Education Commission Other Positions 1. Listed Company - None 2. Public Company - None 3. Limited Company - None 4. Other Organizations / Institutions (4) >> Chairman of the Independent Monitoring and Evaluation Committee, Political Development Council >> Board of Committee, Independent Monitoring, Audit and Evaluation Committee, King Prajadhipok’s Institute >> Advisor to Thailand Institute of Justice (Autonomous Public Organization) >> Councilor, Thailand Management Association (TMA) 5. State Enterprise - None % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
None None None None
065
THAI OIL PUBLIC COMPANY LIMITED
Board of Directors
ANNUAL REPORT 2014
Mr. Praipol Koomsup
Mr. Yongyut Jantararotai M
Independent Director (Non-Executive)) (Appointed on September 12, 2014) and Member of the Corporate Governance Committee (Appointed on September 26, 2014) Age 67 Yrs.
D Director (Non-Executive) (A (Appointed on April 2, 2014) an and Member of the C e Corporate Governance Committee (A (Appointed on April 25, 2014) Ag Age 55 Yrs.
Education >> B.Econ., University of Western Australia, Australia >> M.Econ., Thammasart University >> Ph.D.,Economics., Yale University, U.S.A.
Education >> B.Eng. (Civil Engineering), Kasetsart University Training for the Directors Courses of Thai Institute of Directors Association (IOD) - None
Training for the Directors Courses of Thai Institute of Directors Association (IOD) >> Director Accreditation Program (DAP 52/2006) >> Director Certification Program (DCP 91/2007) Other Training
- None
Working Experience in the 5 preceding years 1972 - 2012 Instructor, Faculty of Economics, Thammasat University 2008 - 2011 Member of Monetary Policy Committee, Bank of Thailand 2010 Economic Advisory Council to the Prime Minister, Abhisit Vejjajiva 1993 - 2014 Board of Committee, Energy Conservation Fund Present Independent Researcher and Vice Minister for Energy Present Member of the National Reform Council Other Positions 1. Listed Company 2. Public Company 3. Limited Company 4. Other Organizations / Institutions 5. State Enterprise
-
None None None None None
% of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
None None None None
Other Training >> Executive Development Program, Class 59, Office of the Civil Service Commission >> National Defense Course (NDC), Class 51, Thailand National Defence College Working Experience in the 5 preceding years Jul. 2011 Director, Bureau of Energy sector 3 Jan. 2012 Expert on Energy Strategy Director, Office of Public Participatory Promotion Mar. 2013 - Oct. 2013 Director, Office of the Minister, Ministry of Energy Nov. 2013 - Nov. 2014 Assistant of Permanent Secretary, Ministry of Energy Nov. 2014 - Present Deputy Director General, Department of Alternative Energy Development and Efficiency (DEDE), Ministry of Energy Other Positions 1. Listed Company 2. Public Company 3. Limited Company 4. Other Organizations / Institutions 5. State Enterprise
-
None None None None None
% of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
None None None None
066
THAI OIL PUBLIC COMPANY LIMITED
Boa rd o f D i rect o rs
ANNUAL REPORT 2014
Mr. Apisak Tantivorawong
D.Sc. Twarath Sutabutr
Independent Director (Non-Executive) tive) (Re-elected on April 2, 2013) and Chairman of the Risk Management Committee (Elected on May 29, 2013) Age 61 Yrs.
Director (Non-Executive) 4) (Appointed on September 12, 2014) and Member of the Risk Management Committee 4) (Appointed on September 26, 2014) Age 45 Yrs.
Education >> B. Eng. in Chemical Engineering, Chulalongkorn University >> MBA., Industrial Management, University of Tennessee, U.S.A.
Education >> B.Eng. (Civil Engineering), Chulalongkorn University >> MSc. (Geotechnical Engineering), Asian Institute of Technology(AIT) >> Sc.D.(Civil and Environmental Engineering), Massachusetts Institute of Technology (MIT), Cambridge, MA, USA.
Training for the Directors Courses of Thai Institute of Directors Association (IOD) >> Director Certification Program (DCP 18/2002) Other Training >> The Joint State-Private Course, Class 1, Thailand National Defence College Working Experience in the 5 preceding years 2004 - Nov. 2012 President, Krungthai Bank Public Company Limited 2006 - 2010 Independent Director, Indorama Polymers Public Company Limited 2007 - 2009 Chairman, ASEAN Bankers’ Association 2007 - 2010 Chairman, Thai Bankers’ Association 2007 - 2010 Board of Committee, Thai Asset Management Corporation (TAMC) 2007 - 2010 Member of the Board of Investment (BOI) 2012 - Feb. 2013 Independent Director, CP All Public Company Limited
Other Training Advanced Management Program (AMP), INSEAD, France >> Top Executive Program in Commerce and Trade (TEPCoT 16), Commerce Academy, University of the Thai Chamber of Commerce >> TLCA Executive Development Program (EDP), Class 9, Capital Market Academy >> Executive Development Program, Class 61, Office of the Civil Service Commission >> Advanced Energy Course for Executives, Class 2, Ministry of Energy >> New Wave Leader in Thai Governmental Sector, Class 3, arranged by Office of The Civil Service Commission (OCSC) >> Infrastructure in a Market Economy, arranged by JFK School of Government, Harvard University, Cambridge, MA >>
Other Positions 1. Listed Company (4) >> Independent Director, Synnex (Thailand) Public Company Limited >> Independent Director, Indorama Ventures Public Company Limited >> Chairman of the Board, Quality Houses Public Company Limited >> Director/ Member of the Nomination, Compensation and Corporate Governance Committee, Siam Commercial Bank Public Company Limited 2. Public Company (1) >> Independent Director/ Member of the Audit Committee / Chairman of the Risk Management Committee, Bangkok Glass Public Company Limited 3. Limited Company (1) >> Vice Chairman, Finance Committee, Charoen Pokphand Group Company Limited 4. Other Organizations / Institutions - None 5. State Enterprise - None % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
Training for the Directors Courses of Thai Institute of Directors Association (IOD) Director Certification Program (DCP 115/2009)
>>
-
None None None None
Working Experience in the 5 preceding years 2006 - 2007 Deputy Spokesperson, Ministry of Energy 2006 - 2009 Director of Policy & Strategy Coordination Office, Ministry of Energy 2007 - 2009 Director of Public Communication Division, Nuclear Power Program Development Office (NPPDO) 2007 - 2009 Ministry of Energy Spokesperson 2009 - Sep. 2014 Deputy Director General, Department of Alternatives Development and Efficiency, Ministry of Energy 2014 - Present Deputy Permanent Secretary, Ministry of Energy Other Positions 1. Listed Company 2. Public Company 3. Limited Company 4. Other Organizations / Institutions (1) >> Advisor to the Board of Directors, Thai Green Building Institutes 5. State Enterprise
- None
% of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
- None - None - None
None None None None
067
THAI OIL PUBLIC COMPANY LIMITED
Board of Directors
ANNUAL REPORT 2014
Mr. Chansin Treenuchagron Director (Non-Executive) (Appointed on September 26, 2014) Age 54 Yrs.
Education >> B.Econ., Thammasart University >> M.Econ., Chulalongkorn University Training for the Directors Courses of Thai Institute of Directors Association (IOD) >> Director Certification Program (DCP 85/2007) >> Director Accreditation Program (DAP 93/2011) >> Financial Statements for Director (FSD 12/2011) >> Charted Director Class (CDC 6/2012) Other Training >> Relations Development Course for Executive, Class 1, Directorate of Civil Affairs >> Air War College, Class 35 >> Senior Executive Program (SEP), Class 20, Sasin Graduate Institute of Business Administration, Chulalongkorn University >> Advance Senior Executive Program (ASEP), Class 5, Kellogg & Sasin, Chicago, U.S.A 2010 >> PTT Executive Leadership, General Electric, GE, New York, U.S.A. >> Advanced Certificate Course in Public Economics Management for Executives, Class 10, King Prajadhipok’s Institute >> Leadership Excellence through Awareness and Practice (LEAP), INSEAD >> Leadership Development Program (LDP), Class 1 >> National Defense Course (NDC), Class 57, Thailand National Defence College Working Experience in the 5 preceding years 2009 - 2011 Executive Vice President Corporate Planning IRPC Public Company Limited 2010 - 2012 Managing Director IRPC Oil Company Limited 2010 - 2012 Managing Director Thai ABS Company Limited 2011 - 2012 Acting Senior Executive Vice President Corporate Strategy & Planning 2011 - 2014 Senior Executive Vice President Port & Asset Management Business Unit 2012 - 2013 Acting Senior Executive Vice President Corporate Commercial & Marketing IRPC Public Company Limited 2013 - Oct. 2014 Senior Executive Vice President Corporate Commercial & Marketing Oct. 2014 - Present Senior Executive Vice President Corporate Strategy, PTT Public Limited Company
Other Positions 1. Listed Company (1) >> Senior Executive Vice President Corporate Strategy, PTT Public Limited Company 2. Public Company (1) >> Director, Thai oil Public Limited Company 3. Limited Company (2) >> Chairman of the Board, PTT Green Energy Limited Company >> Director, PTT Polymer Logistics Limited Company 4. Other Organizations / Institutions 5. State Enterprise
- None - None
% of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
None None None None
068
THAI OIL PUBLIC COMPANY LIMITED
Boa rd o f D i rect o rs
ANNUAL REPORT 2014
Mr. Atikom Terbsiri Director (Executive) 4) (Appointed on September 12, 2014) Member of the Risk Managementt Committee ident Chief Executive Officer and President and Secretary to the Board 4) (Appointed on September 26, 2014) Age 52 Yrs.
Education >> B.B.A., Bachelor of Business Administration, Assumption University >> M.B.A., (Finance & International Business), High Distinction, Armstrong University, U.S.A. Training for the Directors Courses of Thai Institute of Directors Association (IOD) Director Certification Program (DCP 125/2009)
>>
Other Training The Joint State-Private and Political Course, Class 5, Thailand National Defence College >> Executive Program, Capital Market Academy (CMA), Class 17 >> Advanced Security Management Program (ASMP), Class 1, the Association National Defence College of Thailand >> Executive Education Program, Harvard Business School, Harvard University, U.S.A. >>
Working Experience in the 5 preceding years 2009 - 2011 Senior Executive Vice President, Corporate Strategy & Planning, IRPC Public Company Limited 2011 - 2013 President, IRPC Public Company Limited 2013 - Sep. 2014 Senior Executive Vice President, Petrochemicals & Refining Business Unit, PTT Public Company Limited
Other Positions 1. Listed Company (1) >> Senior Executive Vice President, PTT Public Company Limited 2. Public Company (2) >> Chairman of the Board, Thai Lube Base Public Company Limited >> Director, Global Power Synergy Public Company Limited 3. Limited Company (9) >> Chairman of the Board, Thai Paraxylene Company Limited >> Chairman of the Board, LABIX Company Limited >> Chairman of the Board, Thaioil Power Company Limited >> Chairman of the Board, TOP SPP Company Limited >> Chairman of the Board, Thaioil Energy Services Company Limited >> Chairman of the Board, Thaioil Solvent Company Limited >> Chairman of the Board, TOP Solvent Company Limited >> Chairman of the Board, Thaioil Ethanol Company Limited >> Chairman of the Board, Thaioil Marine Company Limited 4. Other Organizations / Institutions (12) >> Board of Committee, Foundation for Industrial Development, Plastics Institute of Thailand >> Honorable Director of Board of Committee, Center of Excellence on Petrochemical and Materials Technology, S&T Postgraduate Education and Research Development Office, Chulalongkorn University >> Member of Trustee (as Company representative), Petroleum Institute of Thailand >> Director, The Institute of Industrial Energy, The Federation of Thai Industries >> Director, Policy Planning on Materials Technology Development, National Science Technology and Innovation Policy Office >> Director, Thai Industries Estate Foundation >> Director, Rayong Institute of Science and Technology >> Director, Rayong Science Academy Foundation >> Executive Director, Thailand Energy Academy >> Executive Director, Thailand Swimming Association 5. State Enterprise - None % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
None None None None
069
THAI OIL PUBLIC COMPANY LIMITED
Board of Directors
ANNUAL REPORT 2014
Mr. Norkun Sitthiphong
Mr. Apisit Rujikeatkamjorn
Independent Director (Non-Executive) tive) and Chairman of the Board (Resigned from the Board during the year 2014) Age 61 Yrs.
Independent Director (Non-Executive) ve) ee and Chairman of the Audit Committee M) (Completed the term at the 2014 AGM) Age 68 Yrs.
Education >> Bachelor of Engineering (Mechanical), Chulalongkorn University >> M.Sc. (Mechanical Engineering), Oregon State University, U.S.A. >> Ph.D. (Mechanical Engineering), Oregon State University, U.S.A.
Education >> Bachelor of Engineering (Civil Engineering), Khonkaen University >> Master of Engineering (Civil Engineering), Lamar University, Texas, U.S.A.
Training for the Directors Courses of Thai Institute of Directors Association (IOD) >> Role of the Chairman Program (RCP 21/2009) Other Training >> National Defense Course (NDC), Class 47, Thailand National Defence College >> Executive Program, Capital Market Academy (CMA), Class 4 >> Executive Program, Energy Education, Class 2, Thailand Energy Academy
Other Training
Working Experience in the 5 preceding years 2003 - 2010 Deputy Permanent Secretary, Ministry of Energy 2010 - 2013 Permanent Secretary, Ministry of Energy 2011 - 2013 Chairman of the Board, PTT Public Company Limited 2011 - 2014 Chairman of the Board, PTT Exploration and Production Public Company Limited 2012 - 2014 Chairman of the Board, Thaioil Public Company Limited 2014 - Present Independent Director / Chairman of the Audit Committee, Global Power Synergy Public Company Limited Other Positions 1. Listed Company 2. Public Company (1) >> Independent Director / Chairman of the Audit Committee, Global Power Synergy Public Company Limited 3. Limited Company 4. Other Organizations / Institutions (1) >> Chairman of Thailand National Committee of CIGRE 5. State Enterprise % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
Training for the Directors Courses of Thai Institute of Directors Association (IOD) >> Director Accreditation Program (DAP 27/2004) >> Finance for Non-Finance Director (FND 24/2005) >> Understanding the Fundamental of Financial Statement (UFS 5/2006) >> Audit Committee Program (ACP 22/2008) >> Role of the Chairman Program (RCP 26/2011) >> Director Certification Program (DCP 166/2012)
- None
- None
- None -
None None None None
- None
Working Experience in the 5 preceding years 2004 - 2012 Independent Director / Chairman of Audit Committee, Fortune Parts Industry Company Limited 2006 - 2011 Chairman of the Promotion Board for Advancement, Khonkaen University 2006 - 2011 Chairman of the Board, Tele Data (Bangkok) Group Company 2006 - 2011 Member of Khonkaen University Council 2006 - 2013 Director, Thai Lube Base Public Company Limited 2008 - 2012 Chairman of the Board, PAE (Thailand) Public Company Limited 2008 - 2013 Independent Director/ Chairman of the Audit Committee, Thai Rotary Engineering Public Company Limited Other Positions 1. Listed Company (3) >> Chairman of the Board, Siam Global House Public Company Limited >> Chairman of the Board, Seaoil Public Company Limited >> Vice Chairman, Asia Green Energy Public Company Limited 2. Public Company - None 3. Limited Company (3) >> Chairman of the Board, Eco Lighting Company Limited >> Independent Director / Chairman of Nomination Committee, Sakari Resources Company Limited >> Chairman of the Board, Asia Biomass Company Limited 4. Other Organizations / Institutions - None 5. State Enterprise - None % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
None None None None
070
THAI OIL PUBLIC COMPANY LIMITED
Boa rd o f D i rect o rs
ANNUAL REPORT 2014
Mrs. Chanatip Weerasubpong
Mr. Tanawat Ampunant
Independent Director (Non-Executive) and Member of the Audit Committee (Resigned from the Board during the year 2014) Age 59 Yrs.
Independent Director (Non-Executive) ve) e and Member of the Audit Committee (Resigned from the Board during the year 2014) Age 43 Yrs.
Education >> B.Acc., Thammasart University >> LL.B., Ramkhamhaeng University >> M.Acc., Thammasart University >> M.A. (Political Science), Thammasart University
Education >> Bachelor of Engineering (Civil), Rangsit University >> Master of Public and Private Management (MPPM), National Institute of Development Administration (NIDA) >> Doctor of Public Administration (DPA) Valaya Alongkorn Rajabhat University
Training for the Directors Courses of Thai Institute of Directors Association (IOD) >> Advanced Audit Committee Program – (AACP) 2014 >> Director Certification Program – DCP 176/2013
>>
Other Training Executive Program, Capital Market Academy (CMA), Class 19 >> Executive Program, Advanced Justice Process, Class 18, Judicial Training Institute >> Governance for Directors and Executives of Enterprises and Public Organizations, Class 12, Public Directors Institute >> Program for the Development of Human Resources Management, Counseling Center and Business Development Executives, Thammasart University Cooperation with Copenhagen Business School >> Executive Finance Management Program, Thammasart University >> The Joint State-Private Course, Class 19, Thailand National Defence College >> HR Management Program, Berkeley University of America >> Strategic Advisor Program, Kellogg University U.S.A. >>
Working Experience in the 5 preceding years 2008 Director, Bureau of Central Administration, the Revenue Department 2012 Deputy Director General, the Revenue Department 2014-Present Principal Advisor on Tax Base Management, the Revenue Department Other Positions 1. Listed Company 2. Public Company 3. Limited Company (1) >> Board of Committee, Sukhumvit Asset Management Co.,Ltd 4. Other Organizations / Institutions 5. State Enterprise (1) >> Board of Committee, Playing Cards Factory % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
- None - None
- None
-
None None None None
Training for the Directors Courses of Thai Institute of Directors Association (IOD) Audit Committee Program (ACP 40/2012) >> Advance Audit Committee Program (AACP 9/2012) >> Director Certification Program (DCP 155/2012) >> Financial Statements for Director (FSD 15/2012) >> Successful Formulation & Execution of Strategy (SFE 14/2012) >> Monitoring the Quality of Financial Reporting (MFR 16/2012) >> Monitoring Fraud Risk Management (MFM 8/2012) >> Monitoring the Internal Audit Function (MIA 13/2012) >> Monitoring the System of Internal Control and Risk Management (MIR 13/2012) >> How to Develop a Risk Management Plan (HRP 1/2012) >> How to Measure the Success of Corporate Strategy (HMS 1/2012) Other Training
- None
Working Experience in the 5 preceding years 2002 - 2011 Managing Director, Commercial Alliance Co., Ltd. 2003 - 2007 Executive Director, Blue Sky Beach Co., Ltd. 2011 - 2012 Director / Member of Executive Committee, TOT Public Company Limited Other Positions 1. Listed Company 2. Public Company 3. Limited Company (1) >> Director, Air Inter Transport Company Limited 4. Other Organizations / Institutions 5. State Enterprise (1) >> Director / Member of Audit Committee, Dhanarak Assets Development Company Limited (State Enterprise under Ministry of Finance) % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
- None - None
- None
-
None None None None
071
THAI OIL PUBLIC COMPANY LIMITED
Board of Directors
ANNUAL REPORT 2014
Mr. Wisan Wuthisaksilp
Gen. Trisak Indararusmi
Independent Director (Non-Executive) and Chairman of the Nomination and Remuneration Committee (Completed the term at the 2014 AGM) Age 64 Yrs.
Independent Director (Non-Executive) e) and Member of the mittee Nomination and Remuneration Committee (Resigned from the Board during the year 2014) Age 64 Yrs.
Education >> Bachelor of Law, Ramkhamhaeng University >> Master of Public Administration, National Institute of Development Administration
Education >> Bachelor of Science, Chulachomklao Royal Military Academy >> Royal Thai Army War College >> Master of Public Administration, National Institute of Development Administration
Training for the Directors Courses of Thai Institute of Directors Association (IOD) >> Director Certification Program (DCP 125/2009) >> Financial Statements for Director (FSD 6/2009) >> Role of the Compensation Committee (RCC 14/2012) Other Training >> The Joint State-Private Course, Class 15, Thailand National Defence College >> Politics and Governance in Democratic Systems for Executives Course, Class 8, the College of Politics and Governance, King Prajadhipok’s Institute >> Chief Executive Officer Development Program, Fiscal Policy Research Institute Foundation Collaboration with Kellogg School of Management and Maxwell School of Citizenship and Public Affairs >> Advanced Justice Process Program for Executives, Class 12, Judicial Training Institute >> Advanced Security Management Program (ASMP), Class 3, the Association National Defence College of Thailand Working Experience in the 5 preceding years 2007 - 2009 Deputy Director General, the Customs Department 2009 - 2011 Principal Advisor on Customs Control Development, the Customs Department Other Positions 1. Listed Company (1) >> Independent Director / Chairman of the Remuneration Committee, SNC Former Public Company Limited 2. Public Company 3. Limited Company 4. Other Organizations / Institutions (1) >> Advisor, Office of the National Broadcasting and Telecommunications Commission 5. State Enterprise
- None - None
% of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
- None None None None None
Training for the Directors Courses of Thai Institute of Directors Association (IOD) >> Director Certification Program (DCP 158/2012) >> Role of the Nomination and Governance Committee (RNG 3/2012) >> Financial Statements for Director (FSD 17/2012) Other Training >> The Joint State-Private Course, Class 1, Thailand National Defence College >> Anti – Corruption for Executive Program (ACEP), Class 10/2014 Working Experience in the 5 preceding years 2005 - 2007 Commander, Military Circle (22), Ubon Ratchathani 2007 - 2009 Advisor to Royal Thai Army Other Positions 1. Listed Company 2. Public Company 3. Limited Company 4. Other Organizations / Institutions 5. State Enterprise (1) >> Advisor to Relations Affair Committee, Thailand Tobacco Monopoly % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
-
None None None None
None None None None
072
THAI OIL PUBLIC COMPANY LIMITED
Boa rd o f D i rect o rs
ANNUAL REPORT 2014
Pol.Gen. Adul Sangsingkeo
Mr. Somkeirt Hudthagosol
Independent Director (Non-Executive) and Member of the Corporate Governance Committee (Resigned from the Board during the year 2014) Age 60 Yrs.
Director (Non-Executive) (Resigned from the Board during the year 2014) Age 64 Yrs.
Education >> B.A. Public Administration, Class 29, Royal Thai Police Cadet Academy >> M.A. Social Science, Kasetsart University
Education >> Bachelor of Arts in Political Science, Chulalongkorn University >> Master of Public Administration, Pennsylvania State University, U.S.A.
Training for the Directors Courses of Thai Institute of Directors Association (IOD) - None
>>
Other Training >> National Defense Course (NDC), Class 42, Thailand National Defence College >> Top Executive Program in Commerce and Trade (TEPCoT 5), Commerce Academy, University of the Thai Chamber of Commerce >> Advanced Insurance Program for Executives, OIC Advanced Insurance Institute >> Executive Program, Advanced Justice Process, Class 15, Judicial Training Institute >> Executive Program, Capital Market Academy (CMA), Class 5 >> Joint Staff Course, Class 33, Joint Staff College Working Experience in the 5 preceding years 2007 Assistant Commissioner General, Acting Commissioner of the Command and Operation Center (Forward Post), Royal Thai Police (Yala Province) 2009 Advisor to Royal Thai Police (Security and Special Tasks) 2009 Member, Board of the Market Organization, Ministry of Interior 2010 Member, Board of the Industrial Estate Authority of Thailand 2010 - 2012 Deputy Commissioner-General, Royal Thai Police 2011 - 2012 Secretary General, Narcotics Control Board 2012 - 2014 Commissioner General, Royal Thai Police May. 2014 - Present Deputy Head of the National Council for Peace and Order for Special Affairs Sep. 2014 - Present Minister of Social Development and Human Security Other Positions 1. Listed Company - None 2. Public Company - None 3. Limited Company - None 4. Other Organizations / Institutions (2) >> Deputy Head of the National Council for Peace and Order for Special Affairs >> Minister of Social Development and Human Security 5. State Enterprise -None % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
-
None None None None
Training for the Directors Courses of Thai Institute of Directors Association (IOD) Director Certification Program (DCP 158/2012) Other Training Working Experience in the 5 preceding years 2004 - 2012 Director, Thai Lube Base Public Company Limited 2006 - 2009 Director, Maesod Clean Energy Company Limited 2006 - 2012 Director, Thai Paraxylene Company Limited 2007 - 2011 Director, Thaioil Energy Solutions Company Limited 2008 - 2010 Deputy Managing Director-Business, Thai Oil Public Company Limited 2008 - 2013 Director, TOP Solvent Company Limited 2008 - 2013 Chairman of the Board, Sak Chaisidhi Company Limited 2008 - 2013 Director, Thaioil Ethanol Company Limited 2009 - 2010 President, Thai Oil Public Company Limited 2009 - 2013 Director, TOP Solvent (Vietnam) Limited Liability 2010 - 2013 Director, Sapthip Company Limited
Other Positions 1. Listed Company 2. Public Company 3. Limited Company (3) >> Deputy Chairman, Thai Tokai Carbon Product Company Limited >> Director, Thaioil Marine Company Limited >> Director, Ubon Bio Ethanol Company Limited 4. Other Organizations / Institutions 5. State Enterprise % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
- None
- None - None
- None - None - 0.0519 - None - None - None
073
THAI OIL PUBLIC COMPANY LIMITED
Board of Directors
ANNUAL REPORT 2014
Mr. Veerasak Kositpaisal Director (Executive) (Appointed on September 12, 2014) Member of the Risk Management Committee nt Chief Executive Officer and President and Secretary to the Board (Appointed on September 26, 2014) Age 60 Yrs.
Education >> B.Eng. (Mechanical), Chulalongkorn University >> M.S. (Mechanical Engineering), Texas A&I University, U.S.A. Training for the Directors Courses of Thai Institute of Directors Association (IOD) >> Director Certification Program (DCP 82/2006) >> Finance for Non-Finance Director (FND 30/2006) Other Training >> Top Executive Program in Commerce and Trade (TEPCoT 2), Commerce Academy, University of the Thai Chamber of Commerce >> Executive Program, Capital Market Academy (CMA), Class 11 >> Leadership Development Program (LDP) >> Executive Program, Energy Education, Class 5, Thailand Energy Academy Working Experience in the 5 preceding years 2006 - 2008 Senior Executive Vice President, Trading Business, PTT Chemical Public Company Limited (PTTCH) and Managing Director, Bangkok Polyethylene Public Company Limited 2008 Senior Executive Vice President, Polymer Product Business Unit, PTTCH 2008 - 2011 President, PTTCH 2011 - 2012 Chief Executive Officer, PTT Global Chemical Public Company Limited 2012 - 2014 Chief Executive Officer and President, Thai Oil Public Company Limited Other Positions 1. Listed Company 2. Public Company 3. Limited Company (1) >> Chairman of the Board, HMC Polymers Company Limited 4. Other Organizations/ Institutions (3) >> Vice Chairman, the Federation of Thai Industries >> Chairman of the Board/ Executive Committee, the Institute of Industrial Energy, the Federation of Thai Industries >> Member of Energy Private Sector and Government Working Team 5. State Enterprise % of Shareholding in Thaioil Conflict of Interest Family Relation with Other Directors Dispute in the 10 Preceding Years
- None - None
- None 0.0020 - None - None - None
074
THAI OIL PUBLIC COMPANY LIMITED
M a na g ement Org a ni zatio n
15
ANNUAL REPORT 2014
MANAGEMENT ORGANIZATION As of December 31, 2014
Managing Managing Managing Managing Managing Managing Managing Managing Managing
Director Director Director Director Director Director Director Director Director
-
TLB TPX TM TES TET TP LABIX TS SAKC
EXECUT IVE VICE PRES IDENT STRATEGY Somchai Wongwattanasan
EX EC U TIVE VIC E P R E S I D E N T FINA NC E A ND A C C O U N T I N G Prisana Praharnkhasuk
EXECUTIVE VICE PRESIDENT C O R P O R AT E C O M M E R C I A L Wisnu Wongsomboon
STR AT EGIC PLANNING MA NA G ER Pattaralada Sa-Ngasang
FINA NC IA L P L A N N I N G M A N A G E R Siriporn Mahajchariyawong
C O M M E R C I A L P LA N N I N G M A N A G E R Chatapong Wungtanagorn (Act.)
BU SINESS DEVELO PM ENT MA NA G ER Duangporn Teerapabpaisit
A C C OU NTING MA N A G E R Prapin Thongnium
COMMERCIAL MANAGER Acharee Tiyabhorn
COR PORAT E STRAT EG IC R IS K MANAGER Pattaralada Sa-Ngasang (Act.)
TR EA S U RY MA N A G E R Daranee Mandhatuphalin
SUPPLY CHAIN OPTIMIZATION MANAGER Chatapong Wungtanagorn
A S S I S TA N T E X E C U T I V E VICE PRESIDENT M A N U FA C T U R I N G Kosol Pimthanothai M A N U FA C T U R I N G M A N A GE R R E F I N E RY Bandhit Thamprajamchit Remarks : 01/05/2009 >> Nitas Krongvanitchayakul
Assignment at TM : TM-MD
01/09/2009 >> Teardchart Padungrat
Assignment at TS : TS-MD
01/01/2013 >> Pongpun Amornvivat
Assignment to TLB-MD and TPX-MD
01/01/2013 >> Viroj Wongsathirayakhun
Assignment at TES : TES-MD
10/01/2013 >> Klahan Tochamnanvit
Assignment at GPSC
11/07/2013 >> Suchart Monyanont
Assignment at LABIX
M A N U FA C T U R I N G M A N A GE R P E T R O C H E M I C A L A N D LUBE BASE Pongpun Amornvivat
075
THAI OIL PUBLIC COMPANY LIMITED
Man age m e n t Organization
ANNUAL REPORT 2014
BO ARD OF DIRE CT ORS
CHIE F E X E C U T I V E O F F I C ER A N D P R ES I D EN T Atikom Terbsiri
A UDI T C OM M I T T EE
Internal Systems Audit Manager
EXECUTIVE VIC E P R ES IDENT REF INERY AND P ETR OC HEMIC A L Abhinant Supatrabutra
EX EC U T I V E V I C E P R E S I D E N T OR G A N I Z AT I O N E F F E C T I V E N E S S Atikom Terbsiri (Act.)
A S S I S TA N T E X E C U T I V E VICE PRESIDENT C O R P O R AT E G OV E R N A N CE Viroj Meenaphant (Act.)
HU M A N R E S O U R C E S M A N A G E R Viroj Wongsathirayakhun
C O R P O R AT E A F FA I R S M AN AGE R Viroj Meenaphant (Act.)
OR GA N I Z AT I O N D E V E LO P M E N T M A N A G E R Ampon Singsakda
C O R P O R AT E C O M P LI A N C E M AN AGE R Panumas Chuchartchaikulkarn
P R OC U R E M E N T A N D C O N T R A C T M A N A G E R Charlee Balmongkol (Act.)
ASSISTANT EXEC U TIVE VICE PRESIDE NT O PERAT ION EXC EL L ENC E Mitri Reodacha ENGINEERING MA NA G ER Surachai Saengsamran
ASSET DEVELOP MENT MA NA G ER Somkiet Kajonpradapkul
T ECHNO LOGY MA NA G ER Rungnapa Janchookiat (Act.)
I NNOVAT I ON A ND S USTAINABILITY M A NA GER Santi Wasanasiri
QU A LI T Y M A N A G E M E N T M A N A G E R Prasert Raemwanith
076
THAI OIL PUBLIC COMPANY LIMITED
M a na g ement Tea m
16
ANNUAL REPORT 2014
MANAGEMENT TEAM As of December 31, 2014
01
02
03
04
05
06
07
08
01 / MR. ATIKOM TERBSIRI
06 / MR. KOSOL PIMTHANOTHAI
Chief Executive Officer and President
Assistant Executive Vice President – Manufacturing
Executive Vice President – Organization Effectiveness (Act.) 07 / MR. MITRI REODACHA 02 / MS. PRISANA PRAHARNKHASUK
Assistant Executive Vice President – Operation Excellence /
Executive Vice President – Finance and Accounting
Managing Director, Thaioil Power Co., Ltd. / Managing Director, TOP SPP Co., Ltd.
03 / MR. WISNU WONGSOMBOON Executive Vice President – Corporate Commercial
08 / MR. VIROJ MEENAPHANT Assistant Executive Vice President – Corporate Governance
04 / MR. SOMCHAI WONGWATTANASAN
(Act.) /
Executive Vice President – Strategy
Corporate Affairs Manager (Act.)
05 / MR. ABHINANT SUPATRABUTRA Executive Vice President – Refinery and Petrochemical
077
THAI OIL PUBLIC COMPANY LIMITED
Man agement Team
ANNUAL REPORT 2014
09
10
11
12
13
14
15
16
09 / MR. KLAHAN TOCHAMNANVIT
13 / MS. DUANGPORN TEERAPABPAISIT
Department Manager - Assignment as Organization
Business Development Manager
Excellence Manager, Global Power Synergy Plc. 14 / MS. DARANEE MANDHATUPHALIN 10 / MR. JEERAWAT PATTANASOMSIT
Treasury Manager
Managing Director, Sak Chaisidhi Co., Ltd. 15 / MR. TEARDCHART PADUNGRAT 11 / MR. CHATAPONG WUNGTANAGORN
Department Manager - Assignment as Managing Director,
Supply Chain Optimization Manager /
TOP Solvent Co., Ltd.
Commercial Planning Manager (Act.) 16 / Mr. Nitas Krongvanitchayakul 12 / MR. CHARLEE BALMONGKOL
Department Manager - Assignment as Managing Director,
Procurement and Contract Manager (Act.)
Thaioil Marine Co., Ltd.
078
THAI OIL PUBLIC COMPANY LIMITED
M a na g ement Tea m
ANNUAL REPORT 2014
17
18
19
20
21
22
23
24
17 / MR. BANDHIT THAMPRAJAMCHIT
21 / MS. PATTARALADA SA-NGASANG
Manufacturing Manager – Refinery
Strategic Planning Manager / Corporate Strategic Risk Manager (Act.)
18 / MS. PRAPIN THONGNIUM Accounting Manager
22 / MS. PANUMAS CHUCHARTCHAIKULKARN Corporate Compliance Manager
19 / MR. PRASERT RAEMWANITH Quality Management Manager
23 / MR. VIROJ WONGSATHIRAYAKHUN Human Resources Manager /
20 / MR. PONGPUN AMORNVIVAT
Department Manager – Assignment as Managing Director,
Manufacturing Manager – Petrochemical and Lube Base /
Thaioil Energy Service
Department Manager – Assignment as Managing Director, Thai Lube Base Plc. /
24 / MS. RUNGNAPA JANCHOOKIAT
Department Manager – Assignment as Managing Director,
Technology Manager (Act.)
Thai Paraxylene Co., Ltd.
079
THAI OIL PUBLIC COMPANY LIMITED
Man agement Team
ANNUAL REPORT 2014
25
26
27
28
29
30
31
32
25 / MR. SARAN HARINSUTA
29 / MR. SUCHART MONYANONT
Managing Director, Thaioil Ethanol Co., Ltd.
Department Manager - Assignment as Managing Director, LABIX Co., Ltd.
26 / MS. SIRIPORN MAHAJCHARIYAWONG Financial Planning Manager
30 / MR. SURACHAI SAENGSAMRAN Engineering Manager
27 / MR. SOMKIET KAJONPRADAPKUL Asset Development Manager
31 / MS. ACHAREE TIYABHORN Commercial Manager
28 / MR. SANTI WASANASIRI Innovation and Sustainability Manager
32 / MR. AMPON SINGSAKDA Organization Development Manager /
080
THAI OIL PUBLIC COMPANY LIMITED
As s et s a nd S ha reho l d e r s I n f o r m a tio n a n d M a n a g e m e n t S tr u c t u re
17
ANNUAL REPORT 2014
ASSETS AND SHAREHOLDERS INFORMATION AND MANAGEMENT STRUCTURE
Assets and Shareholders Information Registered and Paid-up Capitals
Baht 20,400,278,730, comprised of 2,040,027,873 ordinary shares at the par valued at Baht 10 per share.
Ordinary Shares O n t h e s h a re re g i s t r a t i o n b o o k c l o s i n g d a t e a s o f
Shareholders
October 31, 2014, the company’s registered capital
As of October 31, 2014, the first ten major shareholders
was Baht 20,400,278,730 and the paid-up capital was
are as follows:
Top Ten Major Shareholders
(1)
(2)
1
PTT PUBLIC COMPANY LIMITED
2
THE HONGKONG AND SHANGHAI BANKING
Number of
Shareholding
Shares
Percentage
1,001,647,483
49.10
60,816,660
2.98
CORPORATION LIMITED, FUND SERVICES DEPARTMENT 3
STATE STREET BANK EUROPE LIMITED
60,202,193
2.95
4
STATE STREET BANK AND TRUST COMPANY
50,097,945
2.46
5
THE BANK OF NEW YORK MELLON
36,488,706
1.79
6
JX Holdings, Inc.
36,137,200
1.77
7
HSBC (SINGAPORE) NOMINEES PTE LTD
32,980,721
1.62
8
CHASE NOMINEES LIMITED 15
25,562,954
1.25
9
GIC PRIVATE LIMITED-C
17,427,500
0.85
IRPC PUBLIC COMPANY LIMITED
16,900,000
0.83
1,338,261,362
65.60
10
Total Remark:
(1) Excluding shareholders of Thai NVDR Co., Ltd., a subsidiary of the Stock Exchange of Thailand with the objective of promoting investor’s investment, particularly foreign investors, in order to invest in common stock of listed companies without being restricted by the foreign shareholding limit which does not have the right to vote at meetings of listed companies. (2) As a major shareholder of Thaioil, PTT Public Company Limited (PTT) participates in formulating the Company’s management and operational policies by nominating directors to Thaioil’s Board of Directors and casting their votes in Board meetings. As of year end 2014, there are three directors from a total of 14 who are also holding position as PTT Board of Directors and/or Management team.
081
THAI OIL PUBLIC COMPANY LIMITED
A sse t s an d Sh are h ol d e rs In form at i on an d Man age ment Structure
ANNUAL REPORT 2014
Issuance of Other Securities
except payment of interim dividend which the Board is
Debentures
authorized to approve periodically when the Company’s
The Company issued three unsecured debentures of
profit deems it appropriate. The interim dividend payment
USD 1.35 billion in total, comprised of USD 350 million due
shall be reported at the following shareholders meeting.
in 2015, USD 500 million due in 2023, and USD 500 million due in 2043.
The dividend policy for Thaioil’s subsidiaries shall be considered and proposed by the Board of Directors of
Also, the Company issued four unsecured and unsubordinated debentures of Baht 28 billion in total, comprised of Baht 4.500 billion due in 2017, Baht 3 billion due in 2019, Baht 3 billion due in 2021, Baht 3 billion due in 2022, Baht 7 billion due in 2024, and Baht 7.5 billion due in 2027.
each subsidiary to the annual general meeting for approval. Consideration shall be given to investment plans and other requirements and considerations, such as the adequacy of cash flow of each company after deducting reserve funds in accordance with the law.
Dividend Policy The Company’s dividend payout policy is to pay at least 25
Dividend Payout Information
percent of the consolidated net profit after deductions of all Year
categories of reserves as specified in applicable laws and the Company’s article of association. Payment of such dividend
Earnings
is subject to the cash flows and investment plans of Thaioil
(Baht per share)
and its subsidiaries in each year, and other requirements and
Dividend
considerations as determined by the Board of Directors.
(Baht per share)
The Board of Directors may consider paying the annual
Dividend Payout
dividend with approval from the annual general meeting,
(%)
2009 2010 2011 2012 2013 5.91
4.39
7.28
6.04
5.09
2.55
2.00
3.30
2.70
2.30
43.0
45.0
45.0
45.0
45.0
082
THAI OIL PUBLIC COMPANY LIMITED
As s et s a nd S ha reho l d e r s I n f o r m a tio n a n d M a n a g e m e n t S tr u c t u re
Management Structure
ANNUAL REPORT 2014
>>
The management structure of Thai Oil Public Company Limited comprises:
The management with the Chief Executive Officer and President as the highest executive of the Company
The Board of Directors
>>
The Board of Directors
As of December 31, 2014, the Board of Directors is comprised
>>
The four Board-Committees supporting the consideration
of 14 Directors as followed:
and important issues as assigned by the Board of Directors:
>>
the Audit Committee, the Nomination and Remuneration Committee, the Corporate Governance Committee, and the Risk Management Committee
Thirteen non-executive directors, eight of which are independent directors
>>
One executive director, namely the Chief Executive Officer and President
The Board of Directors as of December 31, 2014 comprised of: Name – Surname 1. Mr. Kurujit Nakornthap
Position Director
September 12, 2014
Chairman of the Board
September 26, 2014
2. Mr. Chulasingh Vasantasingh Independent Director
3. Ms. Chularat Suteethorn
4. Mr. Suvit Maesincee
5. Gen. Jiradej Mokkhasmit
6. Mr. Nuttachat Charuchinda
7. Mr. Thaworn Phanichaphan
10. Mr. Yongyut Jantararotai
November 29, 2013
Chairman of the Audit Committee
May 8, 2014
Independent Director
September 20, 2013
Member of the Audit Committee
September 20, 2013
Independent Director
September 12, 2014
Member of the Audit Committee
September 26, 2014
Independent Director
April 2, 2013 (Re - elected)
Chairman of the Nomination and Remuneration Committee
April 10, 2014
Director
April 2, 2013 (Re - elected)
Member of the Nomination and Remuneration Committee
January 24, 2014
Independent Director
November 29, 2013
Member of the Nomination and Remuneration Committee
April 25, 2014
8. Mr. Thosaporn Sirisumphand Independent Director
9. Mr. Praipol Koomsup
Appoint Date
May 25, 2012
Chairman of the Corporate Governance Committee
August 31, 2013
Member of the Nomination and Remuneration Committee
September 26, 2014
Independent Director
September 12, 2014
Member of the Corporate Governance Committee
September 26, 2014
Director
April 2, 2014
Member of the Corporate Governance Committee
April 25, 2014
083
THAI OIL PUBLIC COMPANY LIMITED
A sse t s an d Sh are h ol d e rs In form at i on an d Man age ment Structure
ANNUAL REPORT 2014
Name – Surname 11. Mr. Apisak Tantivorawong
12. Mr. Twarath Sutabutr
Position
Appoint Date
Independent Director
April 2, 2013 (Re - elected)
Chairman of the Risk Management Committee
May 29, 2013
Director
September 12, 2014
Member of the Risk Management Committee
September 26, 2014
13. Mr. Chansin Treenuchagron
Director
September 26, 2014
14. Mr. Atikom Terbsiri
Director
September 12, 2014
Member of the Risk Management Committee
September 26, 2014
Chief Executive Officer and President /
September 26, 2014
Secretary to the Board
The List of directors who completed their terms or resigned during the year 2014 is as followed: Name – Surname 1. Mr. Norkun Sitthipong
2. Mr. Apisit Rujikeatkamjorn
Position Independent Director /
Resigned since
Chairman of the Board
June 16, 2014 onward
Independent Director /
Completed the term in 2014
Chairman of the Audit Committee
AGM on April 2, 2014
3. Ms. Chanathip Weerasubpong Independent Director /
4. Mr. Tanawat Ampunant
5. Mr. Wisan Wuthisaksilp
6. Gen. Trisak Indararusmi
7. Pol.Gen. Adul Sangsingkeo
8. Mr. Somkeirt Hudthagosol
Reasons
Resigned since
Member of the Audit Committee
September 1, 2014 onward
Independent Director /
Resigned since
Member of the Audit Committee
September 1, 2014 onward
Independent Director /
Completed the term in 2014
Chairman of the Nomination and Remuneration Committee
AGM on April 2, 2014
Independent Director /
Resigned since
Member of the Nomination and Remuneration Committee
September 1, 2014 onward
Independent Director /
Resigned since
Member of the Corporate Governance Committee
August 29, 2014 onward
Director
Resigned since September 1, 2014 onward
9. Mr. Veerasak Kositpaisal
Director /
Resigned since
Member of the Risk Management Committee
December 31, 2014 onward
084
THAI OIL PUBLIC COMPANY LIMITED
As s et s a nd S ha reho l d e r s I n f o r m a tio n a n d M a n a g e m e n t S tr u c t u re
ANNUAL REPORT 2014
Shareholding Report of the Board of Directors and the Company’s Management in 2014 (including Spouse and Minor) Shareholding of the Board of Directors as of December 31, 2014: No. of Shares
No. of Share (shares) Name - Surname
Addition (Reduction) Dec. 31, 2013
1. Mr. Kurujit Nakornthap By Spouse and Minor 2. Mr. Chulasingh Vasantasingh By Spouse and Minor
Dec. 31, 2014
During the Year
N/A
-
-
N/A
-
-
-
-
-
-
-
-
3. Ms. Chularat Suteethorn
-
-
-
By Spouse and Minor
-
-
-
4. Mr. Suvit Maesincee
N/A
-
-
N/A
-
-
5. Gen. Jiradej Mokkhasmit
-
-
-
By Spouse and Minor
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
By Spouse and Minor
-
-
-
9. Mr. Praipol Koomsup
N/A
-
-
By Spouse and Minor
N/A
10,000
-
-
-
-
By Spouse and Minor
-
-
-
11. Mr. Apisak Tantivorawong
-
-
-
By Spouse and Minor
-
-
-
N/A
-
-
N/A
-
-
By Spouse and Minor
6. Mr. Nuttachat Charuchinda By Spouse and Minor 7. Mr. Thaworn Phanichaphan By Spouse and Minor 8. Mr.Thosaporn Sirisumphand
10. Mr. Yongyut Jantararotai
12. Mr. Twarath Sutabutr By Spouse and Minor 13. Mr. Chansin Treenuchagron
N/A
-
-
By Spouse and Minor
N/A
-
-
N/A
-
-
N/A
-
-
14. Mr. Atikom Terbsiri By Spouse and Minor
085
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
A sse t s an d Sh are h ol d e rs In form at i on an d Man age ment Structure
No. of Shares
No. of Share (shares) Name - Surname
Addition (Reduction) Dec. 31, 2013
Dec. 31, 2014
1. Mr. Norkun Sitthipong
-
N/A
N/A
By Spouse and Minor
-
N/A
N/A
-
N/A
N/A
-
N/A
N/A
-
N/A
N/A
-
N/A
N/A
-
N/A
N/A
-
N/A
N/A
During the Year
Directors who Resigned During the Year 2014
2. Ms. Chanathip Weerasubpong By Spouse and Minor 3. Mr. Tanawat Ampunant By Spouse and Minor 4. Gen. Trisak Indararusmi By Spouse and Minor 5. Pol.Gen. Adul Sangsingkeo
-
N/A
N/A
-
N/A
N/A
1,058,900
N/A
N/A
-
N/A
N/A
30,000
40,000
10,000
-
-
-
1. Mr. Apisit Rujikeatkamjorn
-
N/A
N/A
By Spouse and Minor
-
N/A
N/A
-
N/A
N/A
-
N/A
N/A
By Spouse and Minor 6. Mr. Somkeirt Hudthagosol By Spouse and Minor 7 Mr. Veerasak Kositpaisal By Spouse and Minor Directors who Completed the Term During the Year 2014 (April 2, 2014)
2. Mr. Wisan Wuthisaksilp By Spouse and Minor
Remark: N/A refers to the unavailable of information due to new appointment, resign during the year or completed their terms in 2014.
086
THAI OIL PUBLIC COMPANY LIMITED
As s et s a nd S ha reho l d e r s I n f o r m a tio n a n d M a n a g e m e n t S tr u c t u re
ANNUAL REPORT 2014
No. of Shares
No. of Share (shares) Name - Surname
Addition (Reduction) Dec. 31, 2013
Dec. 31, 2014
-
-
-
-
-
-
-
-
-
By Spouse and Minor
-
-
-
3. Mr. Wisnu Wongsonboon
-
-
-
8,000
5,000
-
-
-
-
-
-
253,200
253,200
-
-
-
-
-
-
-
-
-
-
50,000
-
(50,000)
-
-
-
18,000
18,000
-
-
-
-
During the Year
Company’s Management 1. Mr. Atikom Terbsiri Chief Executive Officer and President / Executive Vice President – Organization Effectiveness (Act.) By Spouse and Minor 2 Ms. Prisana Praharnkhasuk Executive Vice President – Finance and Accounting
Executive Vice President – Corporate Commercial By Spouse and Minor 4. Mr. Somchai Wongwattanasan
(3,000)
Executive Vice President - Strategy By Spouse and Minor 5. Mr. Abhinant Supatrabutra Executive Vice President – Refinery and Petrochemical By Spouse and Minor 6. Ms. Daranee Mandhatuphalin Treasury Manager By Spouse and Minor 7. Ms. Prapin Thongnium Accounting Manager By Spouse and Minor 8. Ms. Siriporn Mahajchariyawong Financial Planning Manager By Spouse and Minor
087
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
A sse t s an d Sh are h ol d e rs In form at i on an d Man age ment Structure
Structure of the Board of Directors
divided exactly into three parts, the number of directors
According to the Company’s articles of association, the Board
nearest to one-third shall vacate office. A vacating director
of Directors shall consist of at least five members and not
may be eligible to re-election. The directors to vacate office
more than 15 members. Not less than half of the number
in the first and second years following the registration of
of such directors must reside in the Kingdom of Thailand.
the conversion of the Company shall be drawn by lots.
A director needs not be a shareholder of the Company.
In subsequent years, the directors who have remained in office for the longest time shall vacate office.
Appointment and Termination of Directors The nomination, appointment, removal and resignation of
2. Apart from vacating at the end of his office term, a director
directors are prescribed in the Company’s article of
shall vacate office upon death, resignation, lack of
association, which can be summarized as followed:
qualifications or disqualifications under the law pertaining to Public Company Limited and/ or under the Securities
Appointment of Directors
and Exchange Act, removal pursuant to resolution passed
Appointment of directors must be explicitly made at the
at the shareholders meeting, or removal pursuant to a
Annual General Meeting of Shareholders under the following
court order.
criteria and procedures: 3. To resign from office, a director has to hand in his resignation 1. Each shareholder shall have one vote for one share;
letter. Such resignation shall become effective on the
2. Each shareholder may exercise all the votes he or she
date when it reaches the Company. The director who
has under (1) to elect one or several persons as directors but the shareholder cannot divide his or her votes to any person in any number; and
has resigned may also inform the registrar of the facts. 4. The shareholders’ meeting may pass a resolution to remove any director from office prior to retirement by
3. Nominees who receive the largest number of votes in
rotation, by a vote of not less than three-fourths of the
descending order shall be elected. In the event of nominees
number of shareholders attending the meeting and having
receiving equal votes and exceeding the number of
the right to vote and the shares held by them shall, in
vacancies to be filled, the chairman of the meeting shall
aggregate, be not less than half of the number of shares
cast the decisive vote.
held by the shareholders attending the meeting and having the right to vote.
Since 2007, the Board has adopted a resolution to allow minor shareholders’ nomination of qualified director candidates, which must be explicitly made before the AGM and under the Company’s nomination criteria. However, in the year 2014, there was no nomination proposed by minor shareholders (see detail in Corporate Governance Policy Section on page 104)
5. In the event that a position of director becomes vacant for any reason other than the end of his office term, the Board of Directors shall on the next Board meeting appoint a qualified person, not having unacceptable qualities under the laws pertaining to Public Limited Company and the Securities and Exchange Act to be a new director, except if such office term remaining is less than two months.
Removal and Termination of Directors
The replacement director shall hold office only for the
1. At every annual general shareholder’s meeting, one-third
remainder of the term of office of the director whom he
of the directors, or, if the number of directors cannot be
replaces. The resolution of the Board of Directors must
088
THAI OIL PUBLIC COMPANY LIMITED
As s et s a nd S ha reho l d e r s I n f o r m a tio n a n d M a n a g e m e n t S tr u c t u re
be approved by the votes of not less than three-fourths of the number of the remaining directors.
ANNUAL REPORT 2014
4. Review and endorse significant strategies and policies with a focus on business objectives, financial targets, risks, work program, and budget; and ensure that the
Authorized Directors According to the Company’s regulations, two authorized
management follows policies and plans efficiently and effectively;
directors shall jointly sign with affixation of the Company’s seal to represent the Company. The Board has the right to
5. Provide assurance of the accounting system, financial
prescribe and rectify the list of the Company’s authorized
reporting, and audits by forging processes for suitable
directors.
internal control and audit efficiently and effectively, and oversee financial reporting and monitoring progress;
Through the Board of Directors’ Meeting No. 10/2014 on September 26, 2014, the Board of Directors has approved directors having authority to sign on behalf of the Company, namely Mr. Yongyut Jantararotai, Mr. Nuttachat Charuchinda, and Mr. Atikom Terbsiri. The signatures of any two of the three representative directors jointly sign together with the affixation of the Company’s seal.
6. Institute a corporate risk management policy by seeking quarterly risk management reports from the management via the Risk Management Committee, and encouraging the company to conduct risk management system assessment at least once a year while paying due attention to warning signs and anomalies; 7. Oversee and resolve potential conflicts of interest and
Board Roles and Responsibility Observing Company’s regulations, the Board is authorized to conduct roles and responsibilities under the laws, the Company’s objectives, the Company’s article of association, and resolutions approved by shareholders’ meetings. Directors must observe the “Code of Practice for Directors of Listed Companies” stipulated by SET with integrity and prudence
connected transactions, and set practical guidelines to prevent them with a focus on maintaining the best interests of the shareholders and stakeholders at large; institute transaction guidelines prohibiting stakeholders with vested interests from decision-making on such matters; and establish standard procedures and thorough information disclosure of all potential conflicts of interest;
to protect the Company’s interests and maximize profits to its shareholders. To enable the Company’s employees to observe the business principles and establish credibility among shareholders and investors, it has defined the following roles and responsibilities for the Board: 1. Review and endorse activities required by law;
8. Promote a written code of business conduct for directors, executives and employees to ensure full understanding of the Company’s business standard, including earnest, periodic follow-ups of compliance; 9. Under the rules governed by the Securities and Exchange Commission (SEC) and the Stock Exchange of Thailand
2. Conduct the annual performance appraisal and decide compensation for the Chief Executive Officer and President;
(SET), appoint a company secretary to provide legal and assorted regulations that directors must be aware of and
3. Define the corporate vision and take accountability for
comply with in overseeing the Company’s business and
business performance and the performance of the
activities. The company secretary coordinates Company’s
executive team with due attention and prudence;
activities under the Board’s resolutions.
Independent Director / Chairman of the Nomination and
5 Gen. Jiradej Mokkhasmit (5)
Independent Director / Member of the Corporate Governance
Independent Director / Chairman of the Risk Management Committee 12/13
Director / Member of the Risk Management Committee
12 Mr. Twarath Sutabutr (12) 4/4
Director / Chairman of the Board
(Resigned on June 16, 2014)
Independent Director / Member of the Audit Committee
Director / Member of the Risk Management Committee
(Resigned on December 31, 2014)
Director (Resigned on September 1, 2014)
7 Mr. Veerasak Kositpaisal
Committee (Resigned on August 29, 2014)
Independent Director / Member of the Corporate Governance
Remuneration Committee (Resigned on September 1, 2014)
Independent Director / Member of the Nomination and
(Resigned on September 1, 2014)
6 Mr. Somkeirt Hudthagosol
5 Pol.Gen. Adul Sangsingkeo
4 Gen. Trisak Indararusmi
3 Mr. Tanawat Ampunant
(Resigned on September 1, 2014)
2 Mrs. Chanatip Weerasubpong Independent Director/ Member of the Audit Committee
1 Mr. Norkun Sitthiphong
Directors who Resigned During the Year 2557
Secretary to the Board
Chief Executive Officer and President /
13/13
8/8
6/7
7/8
7/8
4/5
5/5
3/3
Director / Member of the Risk Management Committee /
14 Mr. Atikom Terbsiri (14)
9/9
5/5
3/3
10/12
3/3
2/2
4/4
5/5
(5 times)
1/2
3/3
2/2
5/5
2/2
(5 times)
Committee
Committee
Corporate Governance
Nomination & Remuneration
Risk
9/10
3/3
2/3
10/10
7/7
(10 times)
Committee
Management
1/1
1/1
1/1
1/1
1/1
N/A
1/1
N/A
N/A
N/A
1/1
N/A
N/A
1/1
1/1
1/1
1/1
N/A
1/1
1/1
N/A
(1 time)
Shareholders (AGM)
Meeting of
Annual General
ANNUAL REPORT 2014
13 Mr. Chansin Treenuchagron (13) Director
4/4
Director / Member of the Corporate Governance Committee
10/10
4/4
11 Mr. Apisak Tantivorawong (11)
Committee
13/13
10 Mr. Yongyut Jantararotai (10)
9 Mr. Praipol Koomsup (9)
Member of the Nomination and Remuneration Committee
Committee /
8 Mr. Thosaporn Sirisumphand (8) Independent Director / Chairman of the Corporate Governance
Remuneration Committee
12/13 13/13
7 Mr. Thaworn Phanichaphan (7) Independent Director / Member of the Nomination and
11/13
6 Mr. Nuttachat Charuchinda (6) Director / Member of the Nomination and Remuneration
Remuneration Committee
Independent Director / Member of the Audit Committee
4 Mr. Suvit Maesincee (4) 4/4
13/13
Independent Director / Member of the Audit Committee
3 Ms. Chularat Suteethorn (3)
12/12
(12 times)
(13 times) 4/4
Audit Committee
Board of Directors
13/13
Director / Chairman of the Board
Position
2 Mr. Chulasingh Vasantasingh (2) Independent Director / Chairman of the Audit Committee
1 Mr. Kurujit Nakornthap (1)
Name - Surname
Meeting Attendance of the Board of Directors, Board-Committees, and AGM in 2014
THAI OIL PUBLIC COMPANY LIMITED
A sse t s an d Sh are h ol d e rs In form at i on an d Man age ment Structure
089
Position Meeting of
Appointed as director in the Board of Directors’ Meeting No. 9/2014 on September 12, 2014 and appointed as member of the Audit Committee in the Board of Directors’ Meeting No. 10/2014 on September 26, 2014
Re-elected as director in the 2013 AGM on April 2, 2013 and appointed as Chairman of the Nomination and Remuneration Committee in the Nomination and Remuneration Committee Meeting No. 3/2014 on April 10, 2014
Re-elected as director in the 2013 AGM on April 2, 2013 and appointed as member of the Nomination and Remuneration Committee in the Nomination and Remuneration Committee Meeting No. 1/2014 on January 24, 2014
Appointed as director in the Board of Directors’ Meeting No. 11/2013 on November 29, 2013 and appointed as member of the Nomination and Remuneration Committee in the Board of Directors’ Meeting No. 4/2014 on April 25, 2014
Appointed as director in the Board of Directors’ Meeting No. 4/2012 on May 25, 2012, appointed as Chairman of the Corporate Governance Committee in the Corporate Governance Committee Meeting No. 2/2013 on August 31, 2013,
(5)
(6)
(7)
(8)
Appointed as director in the Board of Directors’ Meeting No. 9/2014 on September 12, 2014 and appointed a member of the Corporate Governance Committee in the Board of Directors’ Meeting No. 10/2014 on September 26, 2014
Appointed as director in the 2014 AGM on April 2, 2014 and appointed as member of the Corporate Governance Committee in the Board of Directors’ Meeting No. 4/2014 on April 25, 2014
Re-elected as director in the 2013 AGM on April 2, 2013 and appointed as Chairman of the Risk Management Committee in the Risk Management Committee Meeting No. 2/2013 on May 29, 2013
Appointed as director in the Board of Directors’ Meeting No. 9/2014 on September 12, 2014 and appointed as member of the Risk Management Committee in the Board of Directors’ Meeting No. 10/2014 on September 26, 2014
Appointed as director in the Board of Directors’ Meeting No. 10/2014 on September 26, 2014
Appointed as director in the Board of Directors’ Meeting No. 9/2014 on September 12, 2014 and appointed as CEO/President and member of the Risk Management Committee in the Board of Directors’ Meeting No. 10/2014
(9)
(10)
(11)
(12)
(13)
(14)
and appointed as member of the Nomination and Remuneration Committee in the Board of Directors’ Meeting No. 10/2014 on September 26, 2014
Appointed as director and member of the Audit Committee in the Board of Directors’ Meeting No. 9/2013 on September 20, 2013
(4)
1/1
1/1
(1 time)
Shareholders (AGM)
Appointed as director in the Board of Directors’ Meeting No. 11/2013 on November 29, 2013 and appointed as Chairman of the Audit Committee in the Audit Committee Meeting No. 5/2014 on May 8, 2014
(10 times)
Committee
Annual General
(3)
(5 times)
Risk Management
Appointed as director in the Board of Directors’ Meeting No. 9/2014 on September 12, 2014 and appointed as Chairman of the Board in the Board of Directors’ Meeting No. 10/2014 on September 26, 2014
2/2
(5 times)
Committee
Committee
Corporate Governance
Nomination & Remuneration
(2)
3/3
4/4
(12 times)
(13 times)
3/3
Audit Committee
Board of Directors
(1)
Remark
Independent Director / Chairman of the Nomination and
2 Mr. Wisan Wuthisaksilp
Remuneration Committee
Independent Director / Chairman of the Audit Committee
1 Mr. Apisit Rujikeatkamjorn
Directors who Completed the Term at the AGM 2014 (April 2, 2014)
Name - Surname
090
As s et s a nd S ha reho l d e r s I n f o r m a tio n a n d M a n a g e m e n t S tr u c t u re
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
2 Mr. Chulasingh Vasantasingh
3 Ms. Chularat Suteethorn
4 Mr. Suvit Maesincee
5 Gen. Jiradej Mokkhasmit
6 Mr. Nuttachat Charuchinda
7 Mr. Thaworn Phanichaphan
8 Mr. Thosaporn Sirisumphand
9 Mr. Praipol Koomsup
10 Mr. Yongyut Jantararotai
11 Mr. Apisak Tantivorawong
12 Mr. Twarath Sutabutr
13 Mr. Chansin Treenuchagron
//
//
//
//
//
//
//
//
//
19 Mr. Kosol Pimthanothai
20 Mr. Mitri Reodacha
21 Mr. Viroj Meenaphant
22 Mr. Klahan Tochamnanvit
23 Mr. Jeerawat Pattanasomsit
24 Mr. Chatapong Wungtanagorn
25 Mr. Charlee Balmongkol
26 Ms. Duangporn Teerapabpaisit
27 Ms. Daranee Mandhatuphalin *
ü
ü ü
ü
//
18 Mr. Abhinant Supatrabutra *
ü
ü
ü
//
ü
17 Mr. Somchai Wongwattanasan
ü
ü
//
16 Mr. Wisnu Wongsomboon
ü
v
ü
v
Thaioil Energy Services Co., Ltd.
//
v
Thaioil Marine Co., Ltd.
15 Ms. Prisana Praharnkhasuk
v
Thai Thai Paraxylene Lube Base Co., Ltd. Plc.
ü
ü
v
Thaioil Solvent Co., Ltd.
ü
ü
v
Thaioil Ethanol Co., Ltd.
ü
ü
v
Thaioil Power Co., Ltd.
ü
ü
v
TOP SPP Co., Ltd.
ü
ü
v
TOP Solvent Co., Ltd.(1)
ü
ü
v
ü
ü
Sak Chaisidhi Co., Ltd.(2)
ü
v
TOP Solvent Vietnam LLC.(3)
ü
ü
ü
Sapthip Co., Ltd.(4)
Thaioil TOP Marine Maritime International Service Pte. Ltd.(5) Co., Ltd.(6)
Indirect Subsidiaries
ü
v
LABIX Co., Ltd.(7)
TOP-NTL Pte. Ltd.(8)
TOP Nautical Star Co., Ltd.(9)
TOP-NYK MarineOne Pte. Ltd.(10)
Jointly-Controlled Entity of Subsidiaries PTT ICT Solutions Co., Ltd.
ü
PTT Energy Solutions Co., Ltd.
ü
ü
ü
Global Power Synergy Plc.
ü
ü
Maesod Clean Energy Co., Ltd.(11)
Associates
ü
ü
Ubon Bio Thome Ship Thai Ethanol Management Petroleum Co., Ltd.(12) (Thailand) Pipeline Co., Ltd.(13) Co., Ltd.
Related Companies
ANNUAL REPORT 2014
14 Mr. Atikom Terbsiri
v
Thaioil
1 Mr. Kurujit Nakornthap
Name
Subsidiaries
Information of Directors, Executive Officers and Control Executives as of December 31, 2014
THAI OIL PUBLIC COMPANY LIMITED
ห ลั ก ทatรั พi on ย แ ลan ะ ผู dถื อMan หุ น แ ลage ะ โ ค รment ง ส ร า งStructure ก า ร จั ด ก า ร A sse t s an d Sh are h ol d e ข rsอ มูInลform
091
//
//
//
//
//
41 Mr. Santi Wasanasiri
42 Mr. Suchart Monyanont
43 Mr. Surachai Saengsamran
44 Ms. Acharee Tiyabhorn
45 Mr. Ampon Signsakda
Thaioil Energy Services Co., Ltd.
Thaioil Solvent Co., Ltd.
ü
Thaioil Ethanol Co., Ltd.
ü
Thaioil Power Co., Ltd.
TOP SPP Co., Ltd.
TOP Solvent Co., Ltd. is a subsidiary of Thaioil Solvent Co., Ltd. (TOS), in which TOS holds 100% of shares. Sak Chaisidhi Co., Ltd. is a subsidiary of TOP Solvent Co., Ltd. (TS), in which TS holds 80.5% of shares. TOP Solvent Vietnam LLC. is a subsidiary of TOP Solvent Co., Ltd. (TS), in which TS holds 100% of shares. Sapthip Co., Ltd. is a subsidiary of Thaioil Ethanol Co., Ltd. (TET), in which TET holds 50% of shares. Thaioil Marine International Pte. Ltd. is a subsidiary of Thaioil Marine Co., Ltd. (TM), in which TM holds 100% of shares. TOP Maritime Service Co., Ltd. is a subsidiary of Thaioil Marine Co., Ltd. (TM), in which TM holds 55% of shares. LABIX Co., Ltd. is a subsidiary of Thai Paraxylene Co., Ltd. (TPX), in which TPX holds 75% of shares.
ü
TOP Solvent Co., Ltd.(1)
(1) (2) (3) (4) (5) (6) (7)
= Chief Executive Officer or Managing Director
ü
Thaioil Marine Co., Ltd.
Retired on December 31, 2014
= Director
Thai Thai Paraxylene Lube Base Co., Ltd. Plc.
*
= Chairman
//
40 Mr. Somkiet Kajonpradapkul
Notes:
//
//
36 Mr. Viroj Wongsathirayakhun
39 Ms. Siriporn Mahajchariyawong
//
35 Ms. Panumas Chuchartchaikulkarn
//
//
34 Ms. Pattaralada Sa-ngasang
//
//
33 Mr. Pongpun Amornvivat
38 Mr. Saran Harinsuta
//
32 Mr. Prasert Raemwanith
37 Ms. Rungnapa Janchookiat
//
//
31 Ms. Prapin Thongnium
//
29 Mr. Nitas Krongvanitchayakul
30 Mr. Bandhit Thamprajamchit
//
Thaioil
28 Mr. Teardchart Padungrat
Name
Subsidiaries
ü
Sapthip Co., Ltd.(4)
ü
ü
Thaioil TOP Marine Maritime International Service Pte. Ltd.(5) Co., Ltd.(6)
= Executive Officer
ü
TOP Solvent Vietnam LLC.(3)
ü
LABIX Co., Ltd.(7)
ü
TOP-NTL Pte. Ltd.(8)
ü
TOP Nautical Star Co., Ltd.(9)
ü
TOP-NYK MarineOne Pte. Ltd.(10)
Jointly-Controlled Entity of Subsidiaries
ü
PTT ICT Solutions Co., Ltd.
PTT Energy Solutions Co., Ltd.
Global Power Synergy Plc.
ü
Maesod Clean Energy Co., Ltd.(11)
Associates
ü
ü
Ubon Bio Thome Ship Thai Ethanol Management Petroleum Co., Ltd.(12) (Thailand) Pipeline Co., Ltd.(13) Co., Ltd.
Related Companies
(8) TOP-NTL Pte. Ltd. is a jointly-controlled entity of Thaioil Marine Co., Ltd. (TM), in which TM holds 50% of shares. (9) TOP Nautical Star Co., Ltd. is a jointly-controlled entity of Thaioil Marine Co., Ltd. (TM), in which TM holds 35% of shares. (10) TOP-NYK MarineOne Pte. Ltd. is a jointly-controlled entity of Thaioil Marine International Pte. Ltd. (TOMI), in which TOMI holds 50% of shares. (11) Maesod Clean Energy Co., Ltd. is an associate company of Thaioil Ethanol Co., Ltd. (TET), in which TET holds 30% of shares. (12) Ubon Bio Ethanol Co., Ltd. is an associate company of Thaioil Ethanol Co., Ltd. (TET), in which TET holds 21.3% of shares. (13) Thome Ship Management (Thailand) Co., Ltd. is an associate company of Thaioil Marine Co., Ltd. (TM), in which TM holds 33.3% of shares.
ü
Sak Chaisidhi Co., Ltd.(2)
Indirect Subsidiaries
092
As s et s a nd S ha reho l d e r s I n f o r m a tio n a n d M a n a g e m e n t S tr u c t u re
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
093
THAI OIL PUBLIC COMPANY LIMITED
A sse t s an d Sh are h ol d e rs In form at i on an d Man age ment Structure
ANNUAL REPORT 2014
Management Team As of December 31, 2014: Name-Surname 1. Mr. Atikom Terbsiri
Position Chief Executive Officer and President Executive Vice President - Organization Effectiveness (Acting)
2. Ms. Prisana Praharnkhasuk
Executive Vice President - Finance and Accounting
3, Mr. Wisnu Wongsomboon
Executive Vice President - Corporate Commercial
4. Mr. Somchai Wongwattanasan
Executive Vice President - Strategy
5. Mr. Abhinant Supatrabutra
Executive Vice President - Refinery and Petrochemical
6. Mr. Kosol Pimthanothai
Assistant Executive Vice President - Manufacturing
7. Mr. Mitri Reodacha
Assistant Executive Vice President - Operation Excellence Managing Director, Thaioil Power Co., Ltd. Managing Director, TOP SPP Co., Ltd.
8. Mr. Viroj Meenaphant
Assistant Executive Vice President - Corporate Governance (Acting) Corporate Affairs Manager (Acting)
9. Mr. Klahan Tochamnanvit
Department Manager - Assignment at Global Power Synergy Plc.
10. Mr. Jeerawat Pattanasomsit
Managing Director, Sak Chaisidhi Co., Ltd.
11. Mr. Chatapong Wungtanagorn
Supply Chain Optimization Manager and Commercial Planning Manager (Acting)
12. Mr. Charlee Balmongkol
Procurement and Contract Manager (Acting)
13. Ms. Duangporn Teerapabpaisit
Business Development Manager
14. Ms. Daranee Mandhatuphalin
Treasury Manager
15. Mr. Teardchart Padungrat
Department Manager - Assignment as Managing Director, TOP Solvent Co., Ltd.
16. Mr. Nitas Krongvanitchayakul
Department Manager - Assignment as Managing Director, Thaioil Marine Co., Ltd.
17. Mr. Bandhit Thamprajamchit
Manufacturing Manager - Refinery
18. Ms. Prapin Thongnium
Accounting Manager
19. Mr. Prasert Raomwanith
Quality Management Manager
20. Mr. Pongpun Amornvivat
Manufacturing Manager - Petrochemical and Lube Base Department Manager - Assignment as Managing Director, Thai Lube Base Plc. Department Manager - Assignment as Managing Director, Thai Paraxylene Co., Ltd.
21. Ms. Pattaralada Sangasang
Strategic Planning Manager Corporate Strategic Risk Manager (Acting)
22. Ms. Panumas Chuchartchaikulkarn 23. Mr. Viroj Wongsathirayakhun
Corporate Compliance Manager Human Resources Manager Department Manager - Assignment as Managing Director, Thaioil Energy Services Co., Ltd.
24. Ms. Rungnapa Janchookiat
Technology Manager (Acting)
25. Mr. Saran Harinsuta
Managing Director, Thaioil Ethanol Co.,Ltd.
26. Ms. Siriporn Mahajchariyawong
Financial Planning Manager
27. Mr. Somkiet Kajonpradapkul
Asset Development Manager
28. Mr. Santi Wasanasiri
Innovation and Sustainability Manager
29. Mr. Suchart Monyanont
Department Manager - Assignment as Managing Director, LABIX Co., Ltd.
30. Mr. Surachai Saengsamran
Engineering Manager
31. Ms. Acharee Tiyabhorn
Commercial Manager
32. Mr. Ampon Singsakda
Organization Development Manager
094
THAI OIL PUBLIC COMPANY LIMITED
As s et s a nd S ha reho l d e r s I n f o r m a tio n a n d M a n a g e m e n t S tr u c t u re
Company Secretary
ANNUAL REPORT 2014
January 1, 2013-Present Assistant Executive Vice President -
The Board of Directors appointed the company secretary to
Corporate Governance (Acting) and
take responsibilities in providing advices to the Board and
Company Secretary
executives regarding the applicable laws and regulations
Company Secretary Training:
that the Board must recognize and act upon, the corporate
June 2009
Company Secretary Program (CSP 31/ 2009) from the
governance policies as well as the arrangement of the Board
Thai Institute of Directors (IOD)
of Directors meetings and the annual general meeting of shareholders. The company secretary must also monitor
2014
Director Certification Program (DCP 185/2014) from the
and coordinate to ensure that the Board and shareholders’
Thai Institute of Directors (IOD)
resolutions are fully complied. The company secretary is also assigned to keep Company’s important documents as
Head of the Internal Audit: Internal Systems Audit Manager
required by the laws. The Company has assigned a person
In the Audit Committee Meeting No. 5/2006 on November 10,
who holds the department manager of the Corporate
2006, the committee appointed Ms. Hasaya Nipatvaranan
Management Office to perform the duties as the company
as the Head of the Internal Audit Unit with appropriate
secretary, presently Mr. Viroj Meenaphant holds such
qualifications as follows:
position.
>>
and has 16 years of experience in the internal audit
Brief Biography: Name:
Mr. Viroj Meenaphant
Education:
Bachelor Degree of Engineering (Chemical Engineering),
function; thus has knowledge and understanding of the Company’s business and operations >>
Experience:
with annual training on such operations General Manager, Corporate Affairs; Thai Lube Base (Public) Co.,Ltd.
2003-2004
Received certification as Certified Internal Auditor (CIA) from the Institute of Internal Auditors (IIA) in 2007 along
Chulalongkorn University
2001-2003
Performed in many functions over the period of 23 years
General Manager, Finance;
>>
Qualified to supervise internal audit operations with efficiency and responsiveness in line with the Company’s strategic goals.
Thai Lube Base (Public) Co.,Ltd. 2005-2006
2006-2007
2007-April 2009
2009-December 2012
Assistant Manager,
The Audit Committee must consider, approve, and endorse
Business Development and
the appointment, removal, or termination of the Company’s
Strategic Planning Department
Head of Internal Audit unit. The committee is also responsible
Manager, Strategic Planning
for the annual assessment of the Head of Internal Audit in
Department
accordance with the Audit Committee Charter.
Manager – Special Project and assigned to perform as the
Brief Biography:
Managing Director of
Name:
Thaioil Marine Co.,Ltd.
Education: Bachelor Degree in Business Administration –
Manager of the Corporate Management Office and Company Secretary
Ms. Hasaya Nipatvaranan
Accounting (Assumption University of Thailand) Certificate: Certified Internal Auditor (CIA) from the Institute of Internal Auditors (IIA), United States of America
095
THAI OIL PUBLIC COMPANY LIMITED
A sse t s an d Sh are h ol d e rs In form at i on an d Man age ment Structure
ANNUAL REPORT 2014
Experience:
Board-Committees’ Remuneration
1992-1993
Thaioil Cooperative Manager
(Comprised of the Audit Committee,
1994-1995
Accountant - Treasurer
the Nomination and Remuneration Committee,
1996-1998
Procurement and Contract Coordinator
the Corporate Governance Committee,
1999-2004
Internal Systems Auditor
and the Risk Management Committee)
2005–2014
Internal Systems Audit Manager
Retainer Fee
Internal Audit Training:
Chairman of the Board (1)
31,250
Member of the Board
25,000
Strategic Internal Audit Audit and Control Strategy for Management
Meeting Fee for Directors who Attend the Meeting
Internal Audit Best Practices
Chairman of the Board (1)
The New International Financial Reporting Standards (IFRS)
Vice Chairman of the Board
Internal Control for Financial Reporting
(If any) (1)
Baht 16,875 / meeting
Risk Management / Internal Control / Control Self Assessment
Member of the Board
Baht 15,000 / meeting
Baht 18,750 / meeting
Consulting: Activities, Skills & Attitudes Remark:
Beware of Corruption
(1)
Chairman of the Board and Chairman of the Board-Committees
Corporate Fraud Controls and Investigation Director and
shall receive monthly remuneration of 25% higher than the
Executive Remuneration
directors. Vice Chairman of the Board shall receive monthly remuneration of 12.5% higher than the directors. (2)
Director Remuneration The 2014 AGM set the monthly remuneration for the
Special bonus for directors who took position in 2013 and members who completed or resigned during 2013 by allocating the period of holding the position of individual Board Members.
Company’s directors and Board-Committees including
The Chairman of the Board shall receive the annual incentive of
meeting fee and a special bonus reflecting the Company’s
25% higher than the directors.
performance as followed: In summary, the remuneration of 26 directors, which includes 2014 Remuneration Structure
directors in office during 2014 for a period of 12 months ending
Retainer Fee Chairman of the Board
(1)
Vice Chairman of the Board (If any) Member of the Board Special Bonus for the Board of Directors (2)
(1)
Baht per Month
as of December 31, 2014, and directors who completed their
75,000
terms or resigned during 2014, totals of Baht 16.90 million.
67,500
This comprised monthly remuneration for the Company’s
60,000
directors of Baht 10.62 million, monthly remuneration for
Baht 31 million
Board-Committees of Baht 4.31 million, and meeting fee of
per year
Baht 1.99 million. Directors’ remuneration in the form of a special bonus for 2014 performance totaled to Baht 31 million, which was resolved by the 2014 AGM on April 2, 2014. The remuneration is considered through the comparison with organizations with the equal size in the same industry, as well as the Company’s performance, achievement, responsibilities of the Board of Directors, and overall business circumstances.
Mr. Kurujit Nakornthap Mr. Chulasingh Vasantasingh Ms. Chularat Suteethorn Mr. Suvit Maesincee Gen. Jiradej Mokkhasmit
(2)
Mr. Mr. Mr. Mr. Mr.
Yongyut Jantararotai Apisak Tantivorawong Twarath Sutabut Chansin Treenuchagron Atikom Terbsiri
Director / Chairman of the Board Independent Director / Chairman of the Audit Committee Independent Director / Member of the Audit Committee Independent Director / Member of the Audit Committee Independent Director / Chairman of the Nomination and Remuneration Committee Director / Member of the Nomination and Remuneration Committee Independent Director / Member of the Nomination and Remuneration Committee Independent Director / Chairman of the Corporate Governance Committee / Member of the Nomination and Remuneration Committee Independent Director / Member of the Corporate Governance Committee Director/ Member of the Corporate Governance Committee Independent Director / Chairman of the Risk Management Director/ Member of the Risk Management Committee Director Director/ Member of the Risk Management / Chief Executive Office and President / Secretary to the Board
Position
412,500 296,000 480,000 480,000 474,194 480,000 718,065
60,000.00 60,000.00 45,000.00 75,000.00 150,000.00
536,000 720,000 218,000 180,000 218,000
218,000
720,000
720,000 720,000
265,500 720,000 720,000 218,000 720,000
37,500.00 60,000.00
150,000.00 150,000.00 60,000.00 45,000.00 60,000.00
60,000.00
150,000.00
135,000.00 150,000.00
60,000.00 150,000.00 150,000.00 60,000.00 120,000.00
Board of Directors
95,833 1,215,827
1,110,255
-
-
200,000
-
-
-
-
79,167
281,452 205,000
354,375
Nomination and Renumeration Committee
95,833 -
-
-
-
181,667
105,000
-
-
-
-
348,589 300,000 79,167 -
Audit Committee
933,414
-
-
-
-
-
197,581
-
-
-
205,000 -
79,167
375,000
76,667
-
Corporate Governance Committee
Board-Committees
1,049,194
-
-
-
-
299,194
-
-
-
-
375,000 79,167 75,000
-
-
220,833 -
-
Risk Management Committee
16,898,448
-
-
-
279,833 279,833
555,000 1,167,258
716,774
740,000
721,667
450,000 461,000
891,000 1,245,000 357,167 225,000 353,000
357,167
1,324,167
1,357,285 1,151,667
325,500 1,218,589 1,170,000 357,167 1,194,375
31,000,000
1,494,687.69
1,051,598.46
1,039,782.74
2,156,367.62 2,156,367.62
2,156,367.62 2,156,367.62
2,156,367.62
2,156,367.62
2,156,367.62
2,695,459.53 -
2,156,367.62 -
-
2,156,367.62
2,156,367.62 194,959.27
194,959.27 608,509.22 2,156,367.62
(paid in April 2014 )
Special Bonus for 2013 Performance (1)
Total Remuneration
(Baht)
As s et s a nd S ha reho l d e r s I n f o r m a tio n a n d M a n a g e m e n t S tr u c t u re
Remark: (1) Special bonus for 2013 performance according to the resolution of the 2014 AGM on April 2, 2014, paid to directors on April 24, 2014 (2) The Company provided a vehicle for Chairman of the Board while holding the position to facilitate his/her duty. (3) Complete the term / re-elected as director on April 2, 2014 and appointed as member of the Nomination and Remuneration Committee on May 25, 2014 (4) Appointed as member of the Nomination and Remuneration on January 24, 2014 and resigned from the Risk Management Committee on September 26, 2014 (5) Appointed a Chairman of the Corporate Governance Committee on August 31, 2013 and appointed as member of the Nomination and Remuneration Committee on September 26, 2014
Directors who completed the term at the AGM 2014 / Directors who resigned during the year 2014 (Bonus year 2013) 1 Mr. Apisit Rujikeatkamjorn Independent Director / Chairman of the Audit Committee 184,000 2 Mr. Wisan Wuthisaksilp Independent Director / 184,000 Chairman of the Nomination and Remuneration Committee 3 Mr. Chaikasem Nitisiri Independent Director / Chairman of the Audit Committee (Resigned on July 26,2013) 4 Mr. Somchai Sujjaponhse Independent Director / Member of the Audit Committee (Resigned on July 28,2013) 5 Mr. Somchai Poolsavasdi Independent Director / Member of the Nomination and Remuneration Committee (Resigned on September 11,2013) TOTAL 1,987,500 10,602,258
Directors who resigned during the year 2014 1 Mr. Norkun Sitthiphong Director / Chairman of the Board (Resigned on June 16, 2014) 2 Mrs. Chanatip Weerasubpong Independent Director / Member of the Audit Committee (Resigned on September 1, 2014) 3 Mr. Tanawat Ampunant Independent Director / Member of the Audit Committee (Resigned September 1, 2014) 4 Gen. Trisak Indararusmi Independent Director / Member of the Nomination and Remuneration Committee (Resigned on September 1, 2014) 5 Pol.Gen. Adul Sangsingkeo Independent Director / Member of the Corporate Governance Committee (Resigned on August 29, 2014) 6 Mr. Somkeirt Hudthagosol Director (Resigned September 1, 2014) 7 Mr. Veerasak Kositpaisal Director / Member of the Risk Management Committee (Resigned on December 31, 2014)
10 11 12 13 14
9 Mr. Praipol Koomsup
8 Mr.Thosaporn Sirisumphand (8)
6 Mr. Nuttachat Charuchinda (4) 7 Mr. Thaworn Phanichaphan (3)
1 2 3 4 5
No. Name - Surname
2014 Directors Renumeration
096 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
Executive Remuneration As of the fiscal year ended on December 31, 2014, the remuneration of 25 executives totaled to Baht 190.37 million. This comprises remuneration in the forms of monthly salaries and allowances of Baht 129.41 million, special bonus of Baht 27.74 million, provident fund contributions Baht 14.39 million, retirement gratuity fund payments of Baht 11.70 million, and other payments of 7.13 million Baht. Remark: >>
The Remuneration for 25 executives as of December 31, 2014 Excluding the executives who work in the subsidiary companies, are as followed: Mr. Klahan Tochamnanvit Mr. Nitas Krongvanitchayakul Mr. Teardchart Padungrat Mr. Athavuth Vikitsreth Mr. Pongpun Amornvivat Mr. Suchart Monyanont Mr. Viroj Wongsathirayakhun (divided by the proportion of the managing position of companies within Thaioil Group)
097 A sse t s an d Sh are h ol d e rs In form at i on an d Man age ment Structure
098
THAI OIL PUBLIC COMPANY LIMITED
Ris k F a ct o rs a nd C o rp o r a te R is k M a n a g e m e n t
18
ANNUAL REPORT 2014
RISK FACTORS AND CORPORATE RISK MANAGEMENT
Background
(BCM), a management system to counter potential business
Thaioil constantly commits itself to the development of an
disruption developed under the Business Continuity
Enterprise Risk Management (ERM). The commitment begins
Management Plan (BCP). An appointed BCM Taskforce
with the appointment of the Corporate Strategic Risk
provides all necessary support to strive for high effectiveness
Department, a unit directly and fully in charge of managing
defined by international standards, policies, and business
all risks throughout Thaioil, linking risk management to strategic planning, investment, and operations, thus ensuring full alignment of all business plans and objectives toward
goals. These and other additional assumed conditions will be integrated to form the 2015 BCP drill, which is set to run in conjunction with the refinery emergency drill. All employees
corporate business growth for the short, medium, and long are continuously provided with knowledge and work attitude terms. Through its commitment, skilled and knowledgeable to consistently develop their potential for risk management personnel have been added to handle risk management and streamline corporate risk management procedures into the same standards that cover all work processes thoroughly and align with the corporate policy and risk management
and business continuity to deal with a variety of risks in all situations. With a goal to meet all international standard criteria, a third-party risk management system assessment is
structure. The standards define risk management plans and
also in place. The other advantages are a set of improvements
processes with system assessment, analyses of internal
which Thaioil can continuously deploy to maintain its leading
and external risk factors, and deliberation processes. The
corporate position in Thailand and be ready to expand its
system also includes assessment standards, contingency
business overseas, building corporate reliability on risk
and preventive planning for each identified risk with direct
management and good corporate governance.
responsible personnel or Key Risk Indicator (KRI). These personnel report to the Risk Management Steering Committee
Corporate Risks and Risk Management Plan
(RMSC), a committee with the Group’s executive as members,
and Measures
and to the Risk Management Committee (RMC), a committee
Thaioil promotes systematic monitoring and revision of its
with Board-appointed members. The RMC defines and
risk management and system efficiency. The year’s set of
supervises corporate risk management toward its highest effectiveness and developing risk management practices to become a corporate culture, an ultimate supporting tool
risks, risk management measures, and key risk indicators (KRIs) were presented to the RMC and later to the Board. The Company classifies group risks into five major areas
in driving the organization toward successes defined by comprised of 10 distinct risks, and develop measures or corporate strategic plans and business goals. plans to prevent or mitigate impacts of these risks to achieve To cope with higher uncertainty and severity of risks in the future, Thaioil has put in place Business Continuity Management
the corporate goals.
099
THAI OIL PUBLIC COMPANY LIMITED
Ri sk Fac t ors an d Corp orat e Ri sk Management
ANNUAL REPORT 2014
Strategic Risks
the strategic plan for investment and business expansion
1. Risks from Changes in Government Policies, Laws, and
under the sustainable growth strategy. The analytical process
Regulations
includes project analysis and returns on investment under
Following changes in government policies on national
reviews by the RMC and the Thaioil Group Growth and
development affect Thaioil’s businesses and strategic plans.
Investment Steering Committee. All Thaioil Group projects
The Company more highly values coordination and close
are screened and reviewed under the same investment
monitoring, as well as sharing of data and information with the public in alignment with new policies, laws, and regulations especially on social, communities and environment. This will allow Thaioil to actively participate in the review and
principles under the same standard, with transparency and good governance, and the Thaioil Group Investment Management review process, before being presented to the RMC and the Board for approval. The entire process
promulgation of new laws and regulation. seeks to reduce investment risks and maximize profits while 2. Strategic Direction Risks
maintaining investment confidence among shareholders and
Fully aware of volatile domestic and international economic
stakeholders, aligning with the investment and business
conditions, societal changes, political uncertainties,
expansion for Thaioil Group’s growth.
environmental alteration, and rapid movement of technologies, Thaioil employs a series of strategies to cope with and
Marketing Risks
respond to all changes, both short-term and long-term.
4. Oil Price Fluctuation and Margin Decrease Risks
Thaioil Profit Recovery (TOP) is a strategy focusing on
As a rule, refining profits come from the price of crude oil
strengthening business competency. Growth Execution
and the margin of a given refined product. These highly
(GET) is a driving strategy both in existing core business
fluctuating profits currently tend to swing more. Thaioil
and in new business areas. Finally, Business Excellency
closely monitors the global oil price and analyses to define
and Sustainability (BEST) is a strategy specific for business
and enhance proper marketing strategies and corresponding
development that could become sustainable in the future.
actions, as well as planning, production, sales, and inventory
The TOP GET BEST Strategy is a core strategy used in
management for the Group, as well as PTT Group. The
defining a diversified risk-based investment plan (Thaioil Group Portfolio Management), supporting corporate sustainable growth. Ensuring full alignment with all its subsidiaries and affiliates, Thaioil also launches Thaioil Group Affiliates Management Policy to supervise and govern all affiliates to
Company also deploys more aggressive oil price hedging to prevent financial loss from crack spread and stock loss. This includes an official appointment of the Hedging Steering Committee in charge of screening and joint reviews of corporate strategic plans and business goals prior to
pursue and conduct their businesses in the long run in the presenting to the RMC and the Board for approval. This same direction and with optimal returns. routine has successfully reduced risk levels and maintained 3. Strategic Execution Risks
the Company’s gross integrated margins (GIMs) at the target
Investment risk analysis of new businesses to drive returns
level. In conjunction with these measures, other activities
is a process that Thaioil focuses on significantly as part of
such as energy-saving from loss control, sales strategies,
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and inventory management have been promoted to control
costs. To reduce this risk exposure, Thaioil and its affiliates
operating costs and maximize profits.
arrange the debt ratio to match the revenue structure with natural hedging. This year, the Company implemented
5. Feedstock Interruption Risks The risks on transport and shipment of crude oil have been increased continuously because of political instability and unrest in many countries, together with natural catastrophes.
various measures as same as the previous year, including forward contracts for transactions in foreign currencies, loan withdrawals, and balance of loan payments with the actual loan calls.
Higher risks are correspondingly imposed on crude supply in volumes and prices originally planned. To lower risks from
8. Funding Risks
this feedstock interruption, Thaioil increases its monitoring
The economic crisis of the Eurozone and China’s economic
and market analyses, as well as searching for supplies from
slowdown have impacted the investment and funding plans
new oil fields to increase the feedstock and reserve for the
of Thaioil Group, which has sought to reduce these risk
Group. Additional measures are the improvement of refining
exposures by diversifying its sources of loans in the money
efficiency for supplies coming from new oil fields and supply
and the capital markets. In January, Thaioil issued debt
chain synergy with other refineries in PTT Group to ensure
Baht-denominated debentures for 3, 5, 7 and 10 years in
sufficient feedstock at appropriate prices to the plans.
maturation periods, totaling to Baht 15,000 million, for
6. Demand Fluctuation Risks The fluctuation risks of finished product demand tend to be higher as a result of domestic and world economy and technological advancement especially in the energy conservation and renewable energy policy. Thaioil needs to continually adjust its marketing strategies, including market expansion and approaching new customers in the region to provide them with satisfactory services with convenience and flexible product options. Thaioil has initiated a project
refinancing and increasing the liquidity and capital investment for projects under the corporate investment plans, which had been prioritized with specific capital investment to support business growth. Close monitoring of movements of money and capital markets, loan pre-payment, development of derivatives and close cooperation with members of PTT Group are tools and mechanisms supporting the Company’s ability to locate funds with appropriate terms.
Operations Risks
to deliver products on wheels, extend the cooperative use of 9. Business Disruption Risks oil terminals with other members of PTT Group, and step up With Business Continuity Management (BCM) and Business cooperation with other refineries and government authorities to maximize sales of its products in Thailand, Indochina, and other export markets, together with surplus management.
Continuity Management Plan (BCP) in place, Thaioil emphasizes preparedness to ward off business disruption. A BCM drill is scheduled to follow the emergency drill at the refinery, with a
Financial Risks
fictitious severe incident at the Bangkok Office under the
7. Foreign Exchange Risks
ISO 22300 standard. In addition to the refinery preventive
With the oil price fixed to the US dollar, fluctuation of the
measures, the corporate social responsibility (CSR) programs,
Baht and the US dollar directly impacts Thaioil’s operating
and the community engagement networks, minimizing the
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loss by securing business interruption insurance was under
review of the organizational structure, manpower plan analysis,
review. Other measures include close cooperation with state
and personnel development to meet long-term strategic
agencies, military units, and provincial authorities on safety
growth plans, recruitment work process improvement,
and security; joint preventive operations with PTT Group;
executive meetings on succession plans, and integrated
and coordinating emergency response plans with all affiliates
recruitment plans with business directions and strategies to
and provincial authorities. All these activities and plans
ensure the Company’s capabilities to shareholders.
support existing risk management plans to make possible zero business disruption, including delivery of products to customers as planned, and prevent losses of lives and properties of communities and the environment.
As a result of its constant commitment to continued risk management under the framework and structure of the corporate risk management policy, Thaioil is fully convinced that its international-standard risk management efficiency can
Corporate Risks
prevent and minimize impacts of assorted risks. This is the
10. Human Resource Capability Risks
critical work process driving the organization to overcome
Under the short-term and long-term strategic plans for future
crises and obstacles to success, while creating opportunities
growth, demand for skilled and knowledgeable personnel
for the Company to meet its business targets and achieve
is a critical component for business success. Regularly
strategic plans, as well as bolstering the confidence among
executed are recruitment and accelerated personnel
its shareholders.
development under long-term strategic plans, including
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INTERNAL CONTROLS
Internal controls are constantly valued by Thai Oil Plc. each
policies and procedures in support of efficient business, and
year, the Board assigns the Audit Committee to review the
with suitable checks and balances under the Board’s
assessment and adequacy of the internal control system to
supervision.
ensure that the Company commands an adequate system for efficient businesses and stewardship of properties together with an accurate, credible accounting system that is in compliance with applicable laws and regulations.
The Company has also defined human resource policies and procedures by systematically linking them to its policies and strategies so that its processes of recruitment, development, career growth management, retention of talents, compensation
The Board and the Audit Committee agree that the internal
management, and assessment of potential successors match
control system is indeed adequate and suitable for its
business needs.
businesses. Below is a five-point review of the system.
2. Risk Assessment 1. Control Environment Thaioil commands a good, suitable, and adequate internal control environment, operating under good governance and a code of business conduct, a policy of which and the code have been issued in writing, containing defined roles and
Thaioil values and establishes enterprise risk management by having the Board assigns the Risk Management Committee to define policies and steer the Company’s risk management practices suitably and efficiently, apart from serious application of risk management to ensure goal achievement.
responsibilities together with a code for the Board, executives, and employees and a code for conflicts of interest, and
Thaioil’s plans encompass internal and external assessment
whistle-blowing measures. An electronic reporting system
of risk factors, including strategic, operational, investment,
was developed for all executives and employees to annually
business expansion, compliance, and IT risks and those
disclose their vested interests. The Company also defines
arising from corrupt practices potentially affecting corporate,
monitoring and compliance assessment processes for the
line, and unit businesses. Reviewing work plans and
manual. To this end, Thaioil has continually undergone
monitoring every unit’s execution in line with defined
corporate governance assessment for listed companies so
mitigation measures, it monitors circumstances and analyzes
as to develop, support, and promote business under such
factors potentially causing new, key business risks. To this
principles.
end, it executes risk management processes along with all
Independent of the management, the Board steers and develops internal controls, ensures definition of clear and measurable goals, develops timely strategic planning processes that suit dynamic business conditions, and
units and affiliates to not only identify risks, but also define risk management measures and risk appetites, and tracks KRIs (Key Risk Indicators) to table risks and risk management measures under the risk management reporting structure,
regularly tracks progress.
including the Risk Management Committee and the Board.
Thaioil structures itself by line of command, with defined
The Board assigns the Audit Committee to review financial
Corporate Authorization Procedure (CAP) and written
reports, define rules, and review the adoption of accounting
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policies under generally accepted accounting principles that
controls. It has defined an Information and Communication
are compatible with the Company’s businesses. To this end,
Technology (ICT) policy together with suitable protocols for
requirements are made for systematic reporting, approval
ICT security. It also systematically compiles in groups in line
for adoption, and change in accounting policies. The Audit
with legal requirements.
Committee regularly consults executives, the internal auditor, and the external auditor apart from meeting with the external auditor in the absence of the management and consulting other related units as necessary.
By sending meeting documents to directors ahead of time, the Company ensures that directors get adequate key information for their deliberation.
3. Control Activities
The Company has established internal communication
Thaioil commands rules, policies, procedures, and rules for
channels, under which its personnel get information through
authorizing business transactions, which clearly define in
the intranet and e-mail. In addition, communication between
writing the scopes and approval authorities of executives
executives and those on the job is in place to enable goal
a n d e m p l o y e e s b y a p p ro v a l l e v e l . I t d i v i d e s t h e s e
achievement. As for external communication, the Company
responsibilities to enable mutual checks and balances
discloses information to stakeholders through a variety of
for the sake of business agility and suitable internal controls.
channels, including Company’s website by responsible units,
In addition, the Company clearly defines a review and
namely Investor Relations, Public Relations and Corporate
approval process of connected items, which must be
Branding, and Corporate Governance Sections.
endorsed by senior executives’ meetings and the Audit In addition, Thaioil has established in writing complaint and Committee before tabling them to the Board for approval. whistle-blowing channels so that employees and external Thanks to its policy, Thailoil administers Thaioil Group
parties can report or provide information related to
Affiliates Management (TAM) Policy for the uniformity of all
law-breaking, violation of regulations, frauds, or other acts
group affiliates, joint deliberation of and decision on key
for undue or unlawful gains.
matters, and regular monitoring of affilates’ and associates’ business execution. To this end, Thaioil executives serve as managing directors or presidents or appoint other executives to serve as affiliates’ and associates’ directors, thus enabling Thaioil to play a policy-defining role, and periodically share information and monitor performance outcomes for Key Performance Indicators (KPIs).
5. Monitoring Activities Thaioil requires all executives to look after and audit work within their units for efficiency and conformance to policies, requirements, and work regulations under a strict internal control system. Internal Systems Audit provides support and advice, reviews the internal work systems, and reports audit findings to the Audit Committee independently and candidly.
4. Information and Communication
Executives acknowledge recommendations of audit reports
Thaioil values information and communication systems
and requires suitable corrective actions. Internal Systems
that systematically support business operation, execution,
Audit monitors the progress of such corrective actions
management, and financial reports for decisions made by
through their completion.
the Board and executives, and support effective internal
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CORPORATE GOVERNANCE REPORT
Thaioil is committed to basing business on fairness, integrity,
business with fairness, integrity, and transparency under the
transparency, adhering to corporate governance (CG)
internationally-accepted corporate governance principles,
principles as stipulated by the Stock Exchange of Thailand
which forms the basic value of leading corporations. Below
(SET) and the Securities and Exchange Commission (SEC)
is its corporate governance policy, designed to frame its
to boost confidence among all investors and stakeholders,
various aspects of business:
which is a crucial part of the sustainability.
1. The Board of Directors (“the Board”), the management,
The Board of Directors always values the corporate
and all employees are to perform their duties with utmost
governance policy and conformance to it by requiring that
dedication, determination, devotion, and responsibility
commitment to this policy forms one of the corporate
for the best interest of the company along with adhering
missions. Each year, it devises a development plan for corporate
to the Company’s corporate governance principles and
governance on a par with international standards. Below are
business ethics with understanding, trust, and confidence
details about Thaioil’s corporate governance principles.
as the habitual practice, so that these principles may become an organizational culture.
Corporate Governance Policy Since 2011, Thaioil has had a clearly written corporate governance policy and requires that one responsibility of directors, executives, and employees of Thaioil and its affiliates is to acknowledge and comply with this policy. The Company is to regularly revise the policy, principles, and guidelines in line with its strategies and the approach of corporate governance for listed companies under the Stock Exchange of Thailand (SET).
2. The Board, with the management, plays a key role in defining the Company’s visions, strategies, policies, and business plans, as well as organizes the management structure to ensure the alignment between the Board, the management, and shareholders along with management that are appropriate for the Company’s business operations. 3. The Board and the management will be required to be the ethical leaders and the role model in performing their duties with integrity, honesty, fairness, and transparency,
Last updated in 2013, the policy together with its guidelines underwent amendment this year. The contents are now more
in accordance with the Company’s corporate governance and ethical practices.
clearly classified, encompassing key corporate governance principles. The Company publicized the revised policy,
4. The Board, the management, and all employees are to be
principles, and guidelines on its website (www.thaioilgroup.com)
committed to equality and fair treatment of all stakeholders,
to enable those interested to examine and download them.
as well as monitor, control, and prevent any decision or
Below are the elements of the corporate governance policy.
actions that may lead to the conflict of interests.
Committed to becoming a leading regional corporation
5. Compliance with the corporate governance policy is a
that bolsters investors’ and stakeholders’ confidence in its
key indicator for business management performance
business, supplements value to the organization, and
assessment of the Board and the management, and for
promotes sustainable growth. Thaioil manages its
performance assessment of all employees.
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Corporate Governance Principles
The committee reviews the Company’s performance
The Company has established corporate governance principles
outcomes, financial reports, internal control system, and
as follows:
consider related party transactions, the appropriateness of
1. Responsibility for performing duties with due competence and adequate efficiency 2. Equitable Treatment of all stakeholders 3. Accountability for one’s decisions and actions, with good rationales 4. Creation of Long-Term Value
accounting auditors, including the selection and appointment process. As of December 31, 2014, the Audit Committee consists of three independent directors as follows: Name
1. Mr. Chulasingh Vasantasingh Chairman of the
5. Transparency in conducting business, openness to scrutiny,
Audit Committee
and transparent disclosure of corporate information to related parties
Position
(Independent) 2. Mr. Suvit Maesincee
Member of the Audit Committee
6. Business Ethics as well as conformance to the Code of
(Independent)
Conduct. 3. Ms. Chularat Suteethorn
Member of the
Board-Committees
Audit Committee
The Board of Directors has appointed the Audit Committee,
(Independent),
Nomination and Remuneration Committee, Corporate
with qualified knowledge
Governance Committee, and Risk Management Committee
and experience in accounting
to scrutinize and supervise the operation of the Company
and finance to review
over specific issues, in order to perform their duties efficiently
the reliability of the
and effectively as well as to ensure that the Company
financial statements
complies with rules and regulations of the SEC and SET. For maximum efficiency, the Company has established the
Ms. Hasaya Nipatvaranan, Internal Systems Audit Manager, serves as Secretary to the Audit Committee.
Board-Committees’ Charters to define roles and responsibilities of each committee, which also disclosed in the Company’s website.
Roles and Responsibilities of the Audit Committee 1. Review financial reports for accuracy, reliability, and adequacy by cooperating with the external auditor and
The Board-Committees, as of December 31, 2014 are as
responsible executives who prepare quarterly and annual
follows:
reports.
1) The Audit Committee
2. Review internal control and risk management of Thaioil
The Board appointed the Audit Committee, which consists of
Group to ensure suitability and efficiency, and recommend
fully qualified members against SEC and SET requirements.
further review or audit as necessary, which may also
A minimum of three members must be independent directors,
include improvements on internal control and risk
at least one of whom must be adequately qualified and
management. These reports must be submitted to the
experienced in reviewing the credibility of financial statements.
Board.
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3. Ensure corporate practices in line with SEC laws or SET
13. The audit committee chairman or its members must
requirements, as well as policies, regulations, rules, and
attend the annual general shareholders’ meeting to
other laws pertaining to the Company’s operations.
explain matters related to the committee and the
4. Check corporate documents when in doubt about
appointment of the external auditor.
activities which could significantly impact the Company’s
14. Review and modify the Audit Committee Charter.
financial status and operating performance, and when
15. Undertake tasks assigned by the Board and concurred
conflicts of interest, violation of laws, rules, and regulations
by the Audit Committee.
are possible. 5. Deliberate disclosure of corporate information in case of potential conflicts of interest or possible violation of rules stipulated by SET to ensure sensible transactions and for the maximum benefits to the Company. 6. Select and appoint an independent person as the
In 2014, members of the Audit Committee have been performing duties under the aforementioned roles. The summary of activities is shown in the Audit Committee Report on page 14. 2) The Nomination and Remuneration Committee
external auditor, and deliberate his or her compensation,
Appointed by the Board of Directors, the Nomination and
based on credibility, assigned resources, and financial
Remuneration Committee consists of at least three directors,
auditing workload, as well as work experience; hold a
most of whom must be independent directors. They also must
meeting with the external auditor in the absence of the
not be Chairman of the Board nor Chief Executive Officer.
management at least once a year.
All of the members fully qualified as directors in accordance to the Nomination and Remuneration Committee Charter.
7. Verify accuracy and effectiveness of information technology system related to financial reports and
As of December 31, 2014, the Nomination and Remuneration
internal control.
Committee consists of four directors as follows:
8. Support the development of the Company’s financial
Name
Position
1. Gen. Jiradej Mokkhasmit
Chairman of the Nomination
reporting system to meet international accounting standards.
and Remuneration Committee 9. Review audit plans against internationally-accepted procedures and standards. 10. Ensure independence of Internal Audit, provide guidelines on budgeting and manpower for the group and endorse the appointment, rotation, and termination of the head of the group, and conduct his or her annual performance appraisal. 11. Prepare reports, signed by the audit committee chairman, for the annual report as required by SET.
(Independent) 2. Mr. Thaworn Phanichaphan Member of the Nomination and Remuneration Committee (Independent) 3. Mr. Nuttachat Charuchinda Member of the Nomination and Remuneration Committee 4. Mr. Thosaporn Sirisumphand Member of the Nomination and Remuneration Committee (Independent)
12. Seek independent views of professional experts when
Mr. Viroj Meenaphant, Assistant Executive Vice President-
necessary at the Company’s expense with the concurrence
Corporate Governance (Act.) serves as Secretary to the
of the Board. Such hiring must follow the Company’s terms.
Nomination and Remuneration Committee.
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Roles and Responsibilities of the Nomination and
3) The Corporate Governance Committee
Remuneration Committee
Appointed by the Board of Directors, the Corporate
Nomination
G o v e r n a n c e C o m m i t t e e c o n s i s t e d o f a t l e a s t t h re e
1. Define the procedure and criteria for director nomination.
non-executive directors, most of whom must be independent
2. Define qualifications for directors with a focus on skills, experience, specific capabilities beneficial to the Company,
directors. All of the members are and fully qualified as directors in accordance to the Corporate Governance Committee Charter.
and dedication of time and personal endeavor to perform as directors. 3 Search and select qualified experts for directors and nominate them to the Board to seek approval for appointment from
As of December 31, 2014, the Corporate Governance Committee consists of three directors as follows: Name
Position
1. Mr. Thosaporn Sirisumphand
Chairman of the Corporate
the annual general shareholders’ meeting. 4. Support minor shareholders’ nomination of qualified directors.
Governance Committee (Independent)
5. Search and select qualified experts for directors and nominate them to the Board to seek approval for appointment from
2. Mr. Yongyut Jantararotai
Governance Committee
the annual general shareholders’ meeting. 3. Mr. Praipol Koomsup 6. Select directors who are qualified as committee members
1. Make recommendation to the Board on the organization s t r u c t u r e a n d e s s e n t i a l f a c t o r s o f t h e B o a r d ’s
Member of the Corporate Governance Committee
for the Board’s appointment in case of vacancies. Remuneration
Member of the Corporate
(Independent) Mr. Viroj Meenaphant, Assistant Executive Vice PresidentCorporate Governance (Act.), serves as Secretary to the Corporate Governance Committee.
compensation annually. 2. Propose compensation criteria for the Board in line with their responsibilities and the overall performance of the company. Such criteria must be attractive and adequate to retain competent, quality, and capable directors. The
Roles and Responsibilities of the Corporate Governance Committee 1. Constantly define an international-standard corporate governance policy for Thaioil Group to adopt as their principles.
Board must review the proposal before presenting to the annual general shareholders’ meeting for approval.
2. Define a self-assessment policy and procedure on corporate governance policy while promoting standard
3. C o n d u c t p e r f o r m a n c e a p p r a i s a l a n d d e c i d e t h e compensation for the Chief Executive Officer.
assessment from renowned and internationally accepted appraisers.
In 2014, members of the Nomination and Remuneration
3. Oversee the Company’s business in line with the principles
Committee have been performing duties under the
set forth by regulating institutions, including SET and SEC.
aforementioned roles. The summary of activities is shown
4. Review the corporate gover nance policy regularly,
in the Nomination and Remuneration Committee Report on
adjusting to international practices and recommendations
page 16.
made by regulating institutions or related institutes.
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5. Regularly promote sharing of the corporate governance
Committee and Mr. Somboon Chuaykoblap, Strategic Risk
culture among all executives and employees for clear
and New Investment Risk Manager, serves as Assistant
u n d e r s t a n d i n g a n d a d o p t i o n f o r T h a i o i l G ro u p ’s
of the Risk Management Committee’s Secretary
implementation. Roles and Responsibilities of the Risk Management 6. Advise the working committee in preparation for external corporate governance ranking, at least once in every three years.
Committee 1. To define and review the Company’s enterprise risk management framework that is suitable for efficient
7. Consider and endorse the Company’s board performance
business operation and meets international standards,
appraisal form, including endorsing the appraisal
and to provide recommendations on risk management
outcomes for presentation to the Board.
guidelines that are in line with the operation strategy and
8. Take responsibility for other tasks assigned by the Board.
business plan. 2. To define and review the enterprise risk management
In 2014, members of the Corporate Governance Committee have been performing duties under the aforementioned
policy including the Risk Management Committee Charter to ensure that they are in compliance with the Company’s
roles. The summary of activities is shown in the Corporate
enterprise risk management framework and are effective
Governance Committee Report on page 18.
and adequate for the changing conditions.
4) The Risk Management Committee
3. To continuously and efficiently support and improve on
Appointed by the Board of Directors, the Risk Management
risk management at all levels of the organization, including
Committee consisted of a minimum of three directors, with
its various tools, and to promote a risk management
the Chief Executive Officer and President serving as one
culture.
of the Risk Management Committee members. All of the
4. To oversee, monitor, and review important risk management
members are and fully qualified as directors in accordance
reports and provide necessary recommendations to
to the Risk Management Committee Charter.
ensure efficient and appropriate risk management for the
As of December 31, 2014, the Risk Management Committee consists of three directors as follows:
Company’s business operation, and that an acceptable level of risk is maintained in compliance with the enterprise risk management policy.
Name
Position
1. Mr. Apisak Tantivorawong
Chairman of the Risk
of Directors. In the case where there are factors or events
Management Committee
that might have significant impact on the Company, the
(Independent)
Board of Directors shall be notified immediately.
2. Mr. Twarath Sutabutra
Member of the Risk Management Committee
3. Mr. Atikom Terbsiri
5. To report significant risk management results to the Board
6. To carry out any other responsibilities and duties delegated by the Board of Directors.
Member of the Risk Management Committee
In 2014, members of the Risk Management Committee have been performing duties under the aforementioned roles.
Mr. Somchai Wongwattanasan, Executive Vice President-
The summary of activities is shown in the Risk Management
Strategy, serves as Secretary to the Risk Management
Committee Report on page 20.
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Nomination and Selection of Directors and
Directors and the Company Secretary can be found in the
Chief Executive Officer
Board of Directors section in page 60.
Thaioil provides guidelines for this in the Corporate Governance Manual under Article 5 - Responsibilities of the Board of Directors, that is, the Board must consist of qualified persons with knowledge, expertise, and experience that benefit the Company, with full devotion of time and effort
The Board of Directors has also established a policy on the number of listed companies that the directors can take position. To ensure that the directors can devote their time and effort in performing duties, the directors can take position in no more than five listed companies.
in performing their duties. Directors and Executive Director Nomination Appointed by the shareholders to oversee the Thaioil’s
Regarding the selection of qualified candidates for nomination
operation, the Board appoints the management responsible
as directors in replacement of those who are retired by
for business operation and Board-Committees responsible for
rotation, Thaioil gives the opportunity to our shareholders
specific assignments. The guidelines on the nomination and
to nominate candidates with qualifications required by SEC
selection of directors and senior management are as follows:
laws and by the Company’s regulations to be elected as directors. Announcement has been posted on the website
Directors Compositions and Qualifications According to the Company’s Article of Association, the Board of Directors shall consist of at least five members
for at least 90 days prior to the Annual General Meeting of Shareholders (AGM) to invite nomination from shareholders. Thaioil determines the minimum shareholding for the
and not more than 15 members. All the directors meet the
shareholders who are entitled to nominate directors in
qualifications specified in the Public Company Limited Act
advance, under which they must together hold more than
and none possess any of the forbidden qualities therein.
one percent of the total number of shares with voting shares.
The Board must be knowledgeable and possess diverse skills, including industrial, financial, business, management, international marketing, strategic management, crisis management, law, and auditing skills. Independent directors on the Board represent at least one-third of all directors and must not be less than three directors. The composition of the Board of Directors must have a proportional number of independent directors for work balance of the Board as well as the management’s operation. Presently, the numbers of independent directors of the Company exceed the number
The Nomination and Remuneration Committee will then select and propose the name of the qualified candidates in accordance with the laws and regulations, experience, and knowledge to the Board of Directors for consideration. After the Board’s agreement, the list of such candidates will be proposed to the AGM to approve the election by majority votes. The Nomination and Remuneration Committee also select qualified directors to be members of committees in replacement of the vacancy after the AGM and propose to the Board for approval.
of independent directors as required by law. In case of the vacancy because of reasons other than expiration The Board of Directors consists of 14 directors including of
of the term, as a rule, the Nomination and Remuneration
one executive director and 13 non-executive directors, eight
Committee will consider the criteria and nomination qualified
of which are independent directors. The Board of Directors
persons for directors to fill the vacant post and propose them
has assigned the Nomination and Remuneration Committee
to the Board for consideration. The selected directors will
to nominate and select directors and Chief Executive Officer
be in position to serve only for the remainder of the term of
in case of vacancy. The names and roles of the Board of
the replaced director.
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As for the nomination of qualified persons to fill the position
4. Neither having nor used to have a business relationship
of Chief Executive Officer and President (CEO/President),
with the Company, its parent company, subsidiary,
the Board appoints this person to be responsible for
affiliate, major shareholder or controlling person, in the
business operation. The Nomination and Remuneration
manner which may interfere with his/her independent
Committee will consider the criteria and nomination process
judgment, and neither being nor used to be a significant
of a qualified person to be CEO/President to fill the vacant
shareholder or controlling person of any person having
post and submit them to the Board, as well as reviewing the
a business relationship with the Company, its parent
succession plans and the list of criteria that are appropriate
company, subsidiary company, affiliate, major shareholder
to be considered for the succession.
or controlling person, unless the foregoing relationship has ended not less than two years prior to taking the
Independent Directors and Qualifications The Board of Directors must comprise of sufficient number of independent directors to inspect and balance the performance of the Board and the operation of management team. Independent directors on the Board must represent at least one-third of all directors and must not be less than three directors. Independent directors must have all the qualifications required by the Capital Market Supervisory Board which are:
independent dictatorship. The term ‘business relationship’ under the first paragraph shall include any normal business transaction; rental or lease of immovable property; transaction relating to assets or services or granting or receipt of financial assistance through receiving or extending loans; guarantee; providing assets as collateral; and any other similar actions, which result in the Company or the counterparty being subject to indebtedness payable to
1. Holding shares not exceeding 0.5 percent of the total
the other party in the amount of three percent or more of
number of shares with voting rights of the Company, its
the net tangible assets of the Company or Baht 20 million
parent company, subsidiary, affiliate, major shareholder
or more, whichever is lower. The amount of such
or controlling person, including shares held by related
indebtedness shall be calculated according to the
persons of such independent director.
method for calculation of value of connected transactions under the Notification of the Capital Market Supervisory
2. Neither being nor used to be an executive director, employee, advisor who receives salary, or controlling person of the Company, its parent company, subsidiary, affiliate, same level subsidiary company, major shareholder
Board. The consideration of such indebtedness shall include indebtedness occurred during the period of one year prior to the date on which the business relationship with the person commences.
or controlling person, unless the foregoing status has ended not less than two years prior to taking the independent dictatorship.
5. Neither being nor used to be an auditor of the Company, its parent company, subsidiary, affiliate, major shareholder or controlling person, and not being a significant
3. Not being a person related by blood or legal registration as
shareholder, controlling person, or partner of an audit
father, mother, spouse, sibling, and child, including spouse
firm which employs auditors of the Company, its parent
of child to other director, executive, major shareholder,
company, subsidiary, affiliate, major shareholder or
controlling person, or person to be nominated as
controlling person, unless the foregoing relationship
director, executive or controlling person of the Company
has ended not less than two years prior to taking the
or its subsidiary company.
independent dictatorship.
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6. Neither being nor used to be a provider of any professional
with other senior executives to serve as members on the
services including those as legal advisor or financial
boards in the subsidiaries that Thaioil held 100 percent of
advisor who receives service fees exceeding Baht 2 million
the shares. The CEO/President will serve as Chairman of
per year from the Company, its parent company, subsidiary,
the Board or a member of the boards of the subsidiaries.
affiliate, major shareholder or controlling person, and not being a significant shareholder, controlling person
In addition, Thaioil has developed a TOP Group Affiliates
or partner of the provider of professional services, unless
Management (TAM) policy containing guidelines for those
the foregoing relationship has ended not less than two
assigned to represent itself in looking after and managing
years prior to taking the independent dictatorship.
Thaioil Group affiliates to observe and for Thaioil Group
7. Not being a director appointed as representative of directors of the Company, major shareholder or shareholder who is related to major shareholder.
business cooperation marked by consistent directions. This consistency brings competitive advantages in the achievement of long-term goals and sustainable growth. The TAM policy consists of the management of Thaioil Group
8. Not undertaking any business in the same nature and in
affiliates, duties of Thaioil’s representatives in managing such
competition to the business of the Company or subsidiary
affiliates, together with duties and responsibilities in observing
company or not being a significant partner in a partnership
TAM, which incorporates the corporate governance policy
or being an executive director, employee, advisor who
and the anti-corruption policy, which are also to be observed.
receives salary or holding shares exceeding one percent of the total number of shares with voting rights of other
Related Party Transactions or Acquisition or Disposal
company which undertakes business in the same nature
of Assets of the Company
and in competition to the business of the Company or
Thaioil established the related party transaction policy, in
its subsidiary company.
compliance with the rules and regulations of the SEC and
9. Not having any other characteristics which cause the
accounting standard. The Audit Committee, then, offers
inability to express independent opinions with regard
opinion on the suitability of the item. If the audit directors
to the Company’s business operations.
are unable in considering such matter, the Company will provide a person, who has the knowledge and expertise to
10. The Company’s independent directors shall serve not more than two consecutive terms. To encourage the independent directors and non-executive
provide opinion to incorporate the directors’ consideration. Afterward, it will be proposed to the Board of Directors or through the AGM for approval, in case by case.
directors to independently hold meetings to discuss, recommend, and define guidelines to develop the quality of corporate governance, Thaioil ensures that there is a meeting of the independent directors at least once a year and the meeting of directors without the management at least once a year.
In the event Thaioil or Thaioil subsidiaries* becomes involved in a related party transaction or an activity in which substantial assets of the Company are acquired or disposed, according to the principles of SET, the Company must take the action stipulated by SET. This requires approval to be sought from shareholders to enter a related party transaction or to
Supervision of Subsidiaries’ Operations
acquire or dispose of substantial assets of the Company with
In the supervision of the Thaioil Group’s operations, Thaioil’s
a majority vote not being less than three-fourths of all the
Board of Directors has appointed the CEO/President along
votes of shareholders or proxies attending the meeting and
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eligible to vote without counting the votes of shareholders involved in the conflict of interest.
ANNUAL REPORT 2014
>>
Joined in the annual PTT Group CG Day with other PTT Group companies. This event participated by Thaioil Group executives and employees.
(*Companies, in which Thaioil directly or indirectly, has a shareholding of more than 50 percent of the registered
Moreover, the Company prepares the “Conflict of Interest
paid-up capital of such companies)
Disclosure Electronic Form” for its employees and those of its subsidiaries. The objective is to urge them to perform their
Promotion of Corporate Governance among Employees of Subsidiaries and Affiliates In compliance with the corporate governance policy, Thaioil defines the roles and responsibilities of directors, the management, and all employees of the Thaioil Group to acknowledge and comply with the corporate governance
duties with transparency, promote morality and lawfulness, responsibility for their own actions, as well as increased efficiency in business operation, based on transparency and fairness and in compliance with Thaioil’s corporate governance principles. In 2014, all employees within Thaioil Group have no conflict of interest with the companies.
policy, code of conduct, key policies, and other guidelines concerning this policy for a uniform standard for the entire
As for external communication, apart from the website, the
Company.
Company publicized policies, principles, and guidelines about
To this end, the Company has promoted corporate governance knowledge and understanding, while underscoring the importance of corporate governance among all employees of Thaioil Group as follows:
corporate governance and the code of conduct, together with the anti-corruption policy and complaint/whistle-blowing channels, through events involving stakeholders, including analyst meetings and business partner seminars. Communication with the public occurred where executives
>>
Issued a corporate governance and code of conduct
were invited to share their experiences on corporate
manual for distribution to directors, executives, and
governance operation, as well as news presentations and
employees, all of whom must master its details and then
interviews about the Company’s corporate governance
sign their names in acknowledgment form. The Corporate
published in newspapers and journals.
Compliance Department has a duty to maintains such signatures >>
Developed a CG e-learning system for all Thaioil Group employees to master the corporate governance principles and the code of conduct
Supervision of the Use of Inside Information Recognizing the inter nal data protection is of great importance to the success of the Company. Therefore, to disseminate information and news to outsiders in such a way to protect the Thaioil’s business or reputation,
>>
>>
Elaborated on corporate governance with new employees
Thaioil established a code of conduct on confidentiality
at their orientation
and use of inside information in its corporate governance
Incorporated the topic of corporate governance and the
manual and code of conduct, which serve as guidelines for
code of conduct in the Leadership Development Program,
the directors, the management, and employees as follows:
for section managers >>
1. The Company’s personnel (“personnel”) should maintain
Publicized corporate governance and the code of conduct
inside information and sensitive documents that could
through news articles in Akanee (internal newsletter) and
lead to undue exploitation for themselves, their families,
e-newspaper for all Thaioil Group employees
or their associates, including any information influencing
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stock prices and the company’s proprietary commercial
from directors and executives to refrain from buying, selling,
secrets, formulae, and inventions
or transferring securities at least one month ahead of the
2. Personnel must not apply the Company’s confidential information for personal or others’ gains
company’s performance report to SET each quarter. This is intended to follow the Company’s corporate governance policy on buying or selling securities and fairness in accessing
3. Personnel who have received personal information must
Company information.
take good care of or use it cautiously 4. The Company has defined the information about contractual parties and the agreements with these parties as sensitive information not to be shared with others except when both the Company and its contractual parties have given their consent
Audit Fees of the Auditors 1) Audit Fees The Company, subsidiaries and Thaioil Group Registered Provident Fund paid for the audit fees to the auditors’ company for the latest account period amounting to Baht 6,303,000.
5. The Company should institute strict measures and p ro c e s s e s f o r g u a rd i n g i t s i n f o r m a t i o n w i t h i n i t s
2) Non-Audit Fees
departments to prevent publicity before its formal
The Company and subsidiaries paid for non-audit fees for
distribution. These measures and processes are regarded
monitoring the performance compliance with the condition
as an integral part of the Company’s risk control measures.
of the BOI Promotion Certificate along with fees for Letter of
6. The Company has assigned roles and responsibilities to all superiors for the prevention of leaks of key information
Comfort and Accounting Comments to the auditor’s company for the latest account period amounting to Baht 795,000.
and news by subordinates before the Company’s formal
Compliance with the Company’s Corporate
distribution
Governance
7. Joint use of inside information by personnel must be strictly on a need-to-know basis 8. Even after their termination or retirement, personnel must not disclose the Company’s confidential information
Recognizing and valuing the principles of good corporate governance, the Company has devised a clear policy and guidelines as seen in its corporate governance manual (downloadable at www.thaioilgroup.com). In the past year, Thaioil strictly conform to the rules and regulations in
Under the SEC announcement, directors’ and executives’
accordance to the corporate governance principles, which
securities portfolios are updated and reported to SEC with
can be divided into five articles as follows:
each sale or transfer of securities. At each Board meeting, they must report to the Board their portfolios. Disclosed are portfolio changes of directors and senior executives in the annual 56-1 data disclosure form and the annual report, under the Board’s Shareholding on page 84-86.
Article 1: Right of Shareholders Shareholders have the right to be ownership of the Company, through the appointment of the Board of Director, which shall replaced them in making decisions. The Company values the shareholders’ right by encouraging the shareholders to
In addition, the Company has established guidelines
exercise their rights including legal fundamental rights such
promoting corporate governance concerning the use of inside
as the right to attend and vote in the shareholders’ meeting,
information by sending a reminder requesting cooperation
the right to provide an opportunity for shareholders to
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propose agenda and to nominate director candidates, the
agenda with the opinion of the Board of Directors and
appointment or removal of directors, the remuneration of
minutes of the previous AGM. It also provided explanation
directors, the right to share in the profit, the right to receive
of stipulating conditions and methods of registration,
adequate information, etc.
proxy forms comprised of form A, B, and C (for foreign shareholders that have appointed custodians in Thailand),
Beyond such fundamental rights, the Company endeavors
in accordance with the Ministry of Commerce, together
to provide essential information to shareholders via minor
with the name list of independent directors as shareholders’
shareholders, analysts, and investors’ Company site-visit,
representatives, annual report and sustainability report
website, e-newsletter, etc. The Company arranges the Annual General Meeting of
request forms, and Company’s site-visit forms. >>
Distribute the AGM meeting notices to shareholders not
Shareholders (AGM) every year within four months after the
less than 21 days prior to the meeting. This is to ensure
end of each fiscal year. If there is an urgent need to consider
that the information related to voting decision received
any special matter that may or in connection with the interests
by the shareholders is sufficient, accurate, complete and
of shareholders, which need shareholders’ approval, the
transparent. The information must also be announced in
Board of Directors can call an extraordinary meeting of
the newspapers both Thai and English for three consecutive
shareholders on case by case. In 2014, the Company
days and at least three days prior to the AGM for the
organized AGM on April 2, 2014 at Bangkok International
shareholders to prepare themselves in joining the meeting.
Trade and Exhibition Center (BITEC) with a total attendance of 1,752 shareholders comprising of 1,338 shareholders and
>>
In the event of an emergency to protect the rights and benefits of the Company, notice shall be delivered not
414 representatives by proxy, representing 1,428,208,586 shares or 70 percent of the total issued share capital of the
less than seven days in advance. Information on agenda
Company. The meeting was organized in accordance with
items shall be made available at the Company’s website
the processes and procedures of the AGM Checklist, which
prior to being delivered to shareholders.
prepared by the Thai Investors Association (TIA) as follows: Before the AGM >>
>>
Arranged each shareholder’s meeting at a venue that
Provide an opportunity for shareholders to propose
is convenient, easy to access, and adequate size in
agenda and to nominate director candidates to be elected
Bangkok or its vicinity under good security and set up
in the 2014 AGM, by which the details and procedures are
an emergency plan to increase confidence and security
placed in the Company’s website at least 3 months prior
to all shareholders during the meeting.
to the year ended (from October 1, 2013 to January 31,
>>
Falicitate all shareholders, including major shareholders,
2014). For the fiscal year 2014, none of the shareholders
minor shareholders, and institutional investors, at
has proposed agenda or nominate director candidates
the meeting date. The Company will make registration
for the Board of Directors. >>
On the Date of the AGM
process available two hours prior to the meeting.
Publish the 2014 AGM invitation notice via the Company’s
Furthermore, after this registration period has lapsed,
website for 30 days in advance before the date of the AGM
shareholders who wish to attend the meeting can register
to the shareholders in both Thai and English language.
to attend without losing their rights. The Company shall
The invitation notice comprised of invitation letter, meeting
assign adequate number of officers shall be assigned to
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>>
welcome and check registration documents, as well as
questions, expressing opinions, and making
providing sufficient amount of snacks and beverages for
recommendations at the AGM. The shareholders also
the shareholders.
have rights to participate in the decision of important issues, which may affect the Company, for instance, the
The bar code system was implemented to facilitate the
appointment or removal of directors, the selection of
shareholders’ registration process and counting of vote
nominees to become independent directors, the approval
for accuracy and more convenience. >>
of auditors, the dividend payment, the reduction or addition
For the convenience of voting and ballot counting, the
of capital funds, set or revises rules and regulations, and
Company has prepared separate ballots for each agenda
the approval of memorandum items, etc.
item. Once the voting ends, the ballots are added to
>>
Provide quality assessment of the AGM to use in the
the votes given in proxy forms so that the tallies and
development of the meeting for effectiveness, transparent,
announcement can be undertaken immediately on the
and beneficial to shareholders.
meeting date. >> >>
Around the AGM venue, exhibitions will be put up to
The Company must not deprive the rights of shareholders
display the Company’s key information. An investor
to attend their meetings. All shareholders can exercise
relations corner, managed by investor relations officers,
their rights to attend the entire meetings. The Company
welcomes shareholders and answers their queries.
must provide opportunity for shareholders to raise questions as well as express their opinion independently.
After the AGM >>
>>
with the vote results on the following working day after
independent legal counselors must be at the meeting.
the meeting through Electronic Listed Company Information
Before the meeting, the Chairman of the Board will clarify
Disclosure (ELCID) by notifying SET in the form of a
rules and criteria in relation to the meeting, such as the
newsletter and on the Company’s website.
opening of the meetings, voting procedures, and counting
>>
T h e C o m p a n y m u s t p re p a re t h e m i n u t e s o f t h e shareholder’s meeting and shall notify SET within 14 days
with the Company’s Article of Association.
after the meeting, in accordance with the SET regulations,
The Company has specified director’s interest in the
and disseminate full details of the meeting. This includes
invitation letter and in the AGM. If any directors have
complete and appropriate records of the meeting, voting
particular interest or involved in any agenda, chairman
and questioning process of the shareholders in each
meeting. The directors involved in the interests must not participate in the meeting and must abstain from voting on such matter. The Company allows shareholders to volunteer as witnesses in vote counting and to inquire about the voting. >>
>>
of shareholders’ vote for each session, in accordance
of the meeting must notify the participants prior to the
>>
The Company discloses the resolutions of the AGM along
The Company’s directors, executives, auditors, and
session, along with the allocation of video recordings of the AGM for their acknowledgment in the Company’s website. Consider the recommendations and opinions received from the shareholders in the quality assessment of the AGM to make improvement plan for the following AGM. As a result, Thaioil received the full score of 100 points on the quality
The Company shall support the shareholders to exercise
assessment of the 2014 AGM Checklists, organized by the
their rights in protecting their own interests by asking
Thai Investors Association (TIA).
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Article 2: Equitable Treatment of Shareholders >>
their opinions, ask questions and exercise the rights to
All shareholders are entitled to identical treatment and
elect individual directors. Shareholders vote on every
protection of fundamental rights regardless of their
item using the polling card distributed at the meeting. To
numbers of shares, management status, nationality,
facilitate foreign shareholders, the Company will provide
gender, age, skin color, origin, religious belief, faith,
its staff to translate response to the questions or express
political view, or disability. The Company recognized the
opinions for them.
good corporate governance practice in protecting the rights of the shareholders fairly and equally to bolster the confidence of shareholders and investors alike. The Company provides the opportunity for shareholders to exercise the rights to propose agenda items and qualified
>>
Directors and executives involved in matters on the agenda shall attend the AGM to answer the questions raised by shareholders. The main questions, answers and opinions shall be recorded in the minutes of the meeting for future review by shareholders.
nominees for election as directors in advance during the period specified by the Company at least 3 months
Moreover, the Company established ethical codes on
ahead of the AGM by publishing the procedure through the
maintaining confidential information and the use of inside
SET’s Electronic Listed Company Information Disclosure
information and conflict of interests in the corporate
(ELCID) system and on the Company’s website. The
governance manual which can be downloaded via the
shareholders who wish to propose agenda or nominate
Company’s website.
director candidate must be one single shareholder or several shareholders together hold the Company’s shares at least one percent of total voting rights of the Company.
Article 3: Roles toward the Stakeholders Recognizing stakeholders’ legitimate rights and any agreement with the Company, the Company treats all
>>
Shareholders are entitled to assign proxies to the meeting
stakeholders fairly. The guidelines for compliances related
to cast ballots for them. To this end, they are entitled to
to corporate governance for stakeholders are shown in
receive documents and advice for the purpose, as well
the corporate gover nance manual (downloadable at
as the names of legitimate proxies. Once proxy forms
www.thaioilgroup.com). The following guidelines clearly
have been handed to directors at meetings, proxies are
define work principles for all employees to strictly perform
entitled to participate in the meeting and cast their ballots
on stakeholder engagement. In 2014, the Company operated
like all other shareholders. Shareholders may also
its business in compliance with the plans and activities for
delegate proxies to independent directors, and are entitled
all groups of stakeholders as follows:
to receive complete profiles, data on work experiences, and reports on conflicts of interest for the consideration
Equitable Treatment of Stakeholders
of agenda items from independent directors for their own
Shareholders, Investors, and Analysts
consideration.
The Company, as a representative of the shareholders, is committed to conducting business with transparency, to put
>>
The AGM shall be conducted according to the agenda notified in the notice and it is our policy not to add items to the agenda without advance notice to shareholders.
>>
in place reliable financial and accounting systems, and to deliver optimum shareholder satisfaction. To achieve this, we shall take long-term growth of the Company and reasonable
Adequate time shall be allocated for the meeting and
sustained returns into account. Directors, executives and
equal opportunities provided for shareholders to express
all employees shall perform duties with integrity and make
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decisions in good faith and in fairness to major and minor
of tools and surveyed their satisfaction annually. The outcomes
shareholders alike, as well as for the good of relevant parties.
led to an annual workshop designed to improve customers’
They shall refrain from any activities that could cause conflicts
satisfaction for the information of relevant units and for future
of interest and serve self-interest. Confidential information
improvement. Thaioil also has in place communication about
shall not be divulged to outside parties.
the corporate governance policy, specifically the treatment of customers, and developed a specific website for customers’
This year, the Company regularly communicated its performance outcomes and assorted data with domestic and international investors through various activities, including the annual refinery site-visit for minor shareholders and investors, who met executives to enhance their knowledge
complaints, which served as another channel for customers’ comments and complaints. Such information is linked to the Customer Relationship Management – Voice of Customers (CRM - VOC Management) to accelerate prevention and timely resolution of problems.
and understanding of Company’s businesses; publicized the AGM proceeding video on the Company’s website; quarterly
In addition, the Company jointly developed business plans
analyst meetings on Company’s performance outcomes;
with customers to enable both parties to grow together
quarterly meetings with investors on SET’s Opportunity Day;
in a sustainable way. To this end, customers’ needs are
preparation of the Investor Relations Webpage; electronic
incorporated in investment plan formulation, including the
newsletter for investor relations; oil situation reviews; and
lorry expansion of petroleum product distribution, designed
intelligence about the Company’s industrial status during
to add product delivery efficiency.
key changes and transitions. In addition, the company participated in SET’s annual exhibitions to promote investors’ knowledge, including SET in the City and Money Expo.
Business Partners The Company values equality and integrity of operating its business for utmost benefits, together with our business
Customers
partners by refrain from demanding from, accepting, and
Customer satisfactions shall be achieved by deliver quality
paying improper commercial benefits to business partners.
products which meet their requirements; report the
Stringently, transparently, and equally observe contracts,
Company’s status and performance to shareholders equally,
agreements, and conditions given to business partners. If
regularly, and completely; perform duties with integrity and
conditions cannot be observed, negotiate with business
make decisions in good faith and in fairness to major and
partners well in advance to jointly find reasonable remedies.
minor shareholders alike, as well as for the good of relevant
Improve the Group’s procurement processes, regulations and
parties; refrain from potential conflicts of interest with the
criteria on the appointment of procurement committees so
Company; refrain from seeking undue benefits for oneself
that the general procurement and large projects are
and related parties by exploiting inside information; and
systematic, efficient, suitable to present economic situation,
refrain from unduly disclosing the Company’s confidential
and in compliance with corporate governance principles,
information.
based on good governance, transparency, and accountability.
This year, the Company strictly honored product purchase
This year, the Company developed the Thaioil Group Suppliers
agreements and delivered products with quality matching
Code of Conduct to promote a common understanding
such agreements together with proper certificates to
between the Group and business partners / suppliers in
customers, and allowed customers to witness the calibration
conducting business on the basis of sustainability. To this
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end, it communicated such code along with the anti-corruption
Employees
policy, directions for merchandise procurement management,
Recognizing that employees are the most valuable assets of
the overview and introduction to the use of the e-Procurement
the Company, Thaioil cultivates and develops good working
system, as well as related matters, at the e-Procurement
culture and environment, while promoting teamwork to
Supplier Summit and through business partner relations
bolster employee confidence of career security in working
activities.
for the Company. The following are guidelines to achieving this:
The Company revised Thaioil Group’s hiring/purchasing >>
processes, as well as its regulations and criteria for the
labor laws and regulations, as well as provide safe working
appointment of a price contest panel every year to give
environment, hygienic standards, and treatment of others
the processes transparency, with a suitable audit and
based on equality and fairness
checks-and-balances system. That way, one can be sure that all Thaioil Group’s business partners will receive fair and equal
Strictly comply with the international human rights principle,
>>
Recruitment, selection, and hiring are to be based on
treatment. The Company also developed the e-Procurement
fairness and equal opportunities to all applicants, with
system for greater business flexibility and efficiency of the
priority given to knowledgeable, competent, experienced,
selection process, while making it safer for data on
and righteous persons for a given position, job description,
merchandise selection and services.
and attitude compatible with the Company’s corporate values
In order to avoid and prevent factor that may lead to the >>
contrary to the Company’s policy and in compliance with
Provide fair and proper compensation in line with the knowledge, ability, responsibility, and performance of
the customers and suppliers on the basis of equality and
each person
integrity, the Company has distributed a conforming letter to customers and business partners for their cooperation
>>
and in good faith, while relying on their knowledge, ability,
to not offering gifts that are high-value as well as the
suitability, and behavior
entertainment or hospitality of any kind to Thaioil Group’s employees during the New Year festival.
Promote, transfer, reward, and punish employees fairly
>>
Treat employees fairly and value their development, knowledge, and competency transfer through extensive
Creditors
and regular opportunities given to them
The Company stringently observes contracts, agreements, and conditions given to creditors and consistently reports
>>
in a fair manner
the Company’s financial status with integrity, accuracy, and promptly to creditors. If conditions cannot be observed,
>>
>>
to ensure that all creditors are equally and fairly informed.
Treat employees politely, as individuals, and with respect for human dignity
In its treatment of creditors, the Company has appointed officers directly responsible for communicating with creditors
Avoid unfair practices that could disrupt employees’ job security
negotiate with business partners well in advance to jointly find remedies and prevent damage.
Pay attention to the views and comments of all employees
>>
Provide channel for report or complaint any ethical and illegal behavior
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>>
>>
Promote employees’ understanding of the code of conduct
affecting communities. Examine causes of each complaint,
and roles to promote compliance with the code throughout
take corrective actions, and inform complainants in due
the Company
time to promote mutual interests between communities
Promote employees’ participation in defining business
and the Company for sustainable co-existence
directions and in remedying problems for units in question
>>
>>
Promote educational and environmental activities and
and the Company as a whole
c o n s t a n t l y c u l t i v a t e a n a w a re n e s s o f s o c i a l a n d
Put in place channels for whistle-blowing concerning
environmental responsibility in the Company and among
laws, public regulations, corporate governance, code of
its workforce
conduct, policies, and Company’s regulations, as well
>>
as implied corrupt practices. Protect whistle-blowers,
Cooperate and ensure strict compliance with the laws and relevant rules
complainants, and related parties from negative impacts of their actions.
>>
Value community and social activities with a focus on the development of society, communities, the environment,
This year, the Company executed its human resource
and constructive ways of nurturing and conservation of
administration plan to ensure that employees are ready,
natural resources, notably for communities around the
contented, and capable of achieving exceptional
company’s sites, as well as support public service
p e r f o r m a n c e s f o r t h e C o m p a n y, a s d e t a i l e d u n d e r
activities, including medical care and public health,
Organizational Management, page 58.
community members’ education, sports, and promotion of local cultures with due regard for suitability and
Communities, Society, and Environment
sustainable benefits to society and communities
Take into consideration for the safety of society, environment, and quality of life of the public, the Company recognizes the
>>
Institute a complaint-filing system for matters potentially
importance of preserving natural resources to pass on to
impacting communities; probe causes, amend situations,
later generations while promote natural resources efficiency
and inform complainants about the Company’s actions
to achieve sustainable development. This can be realized
in due time
by following these guidelines: >> >>
Utilization of natural resources shall take into account options with the minimum damage to the societies, environment, quality of life of the public, and refrain from
Run business under applicable standards of quality, security, safety, occupational health, the environment, and energy management, while encouraging efficient energy conservation for the benefit of future generations.
harming natural resources and environment more than allowed by the law >>
Promote conservation of natural resources for the sake of future generations
This year, the Company ran various community relations projects around the refinery, including those concerning public health, education, culture, and the environment through the Thaioil Group’s Health and Learning Center for
>>
Refrain from supporting activities that harm or threaten society or morality, or promote vices
>>
Communities, located in Sriracha District, Chonburi Province. Initiated this year and under feasibility studies are the Khao
Listen to communities’ comments and suggestions and
Phubai Ecology Improvement and the Marine Nursery
put in place a grievance system for matters potentially
projects, among others.
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In addition, the Company has applied energy knowhow, skills,
organizations in providing information for the benefit of the
and experience to social and national development through
country and the public.
a variety of projects, including the “Ban Mae Jo hydropower project,” Mae Taeng District, Chiang Mai Province, which is an energy development project designed to enhance power security for communities, and contains an ecotourism learning center, as well as chemical-free agricultural promotion to continually upgrade lives in communities. The project on biogas from rubber production and household waste and promoting toxin-free homegrown vegetation (phase 2) at Mak Noi Island, Phang-Nga Province, promotes chemical-free vegetation for community hygiene in conjunction with Thaksin University, Phatthalung Campus, to upgrade life and living conditions, while establishing a “prototype island for energy-sustainable community” with a biogas system for the entire island and integrated energy consumption;
As for the treatment of government agencies and related entities, the Company has regularly undertaken compatibility assessment of applicable legislation and monitoring of new law enforcement in parallel with the cultivation of awareness of compliance with the law among its employees. Also, upon requests, it has provided cooperation in the sharing of business knowledge and experience. Competitors The Company complies with the rules of fair competition and treat business competitors fairly for mutually fair returns. Also, refrain from dishonestly or improperly seeking confidential information of business competitors and refrain from defaming business competitors through slander.
the “Building Canals, Building Humans (phase 3)” management project for sustainable economy in Buriram Province
In addition, to encourage equal treatment of stakeholders,
establishes an agricultural water source under the Sufficiency
the Company has defined applicable policies and codes of
Economy principles, promotes community leaders’ skills in
conduct, including a policy on quality, security, safety,
water resource management and agricultural production
occupational health, environment, energy management, and
planning, and improves their project management skills in
social responsibility; codes of conduct on respect for laws
project planning, budget assessment, financial administration,
and international human rights and for respect of intellectual
construction supervision, among others.
property rights or copyrights, among others. These are downloadable from the Company’s website.
Government Authorities and Associated Organizations Strictly comply with legal requirements on environment,
Measures against Corruption
safety, labor, tax and accounting, as well as government
Thaioil has business code of conduct principles including
announcements applicable to conducting the Company’s
conflict of interests; maintaining confidential information
business. Employees at every level must study and
and the use of inside information; giving or acceptance of
understand laws relating to their work and never violate
presents, properties, or other benefits, etc. Thaioil’s code
such laws. Supervisors shall make available relevant laws
of conduct prescribes that employees are prohibited from
to use as reference and shall continually monitor changes.
soliciting or accepting any advantage from third parties
Moreover, employees shall have easy access to data. The
that may impair their objectivity or weaken their ability to
Company shall instill in employees at every level responsibility
promote the best interest of the Company. Employees shall
for constant compliance with laws, rules and Company’s
refrain from offering advantages to outside persons as a
regulations. Good relations shall also be fostered through
motive for him/her to do, or refrain from doing any illegal or
cooperation with related government units and associated
wrongful act that may lead to seek benefits for themselves
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ANNUAL REPORT 2014
or their families. Further detail is disclosed in the corporate
principles and code of conduct on a par with international
governance manual, which can be downloaded in the
standards, to bolster confidence among all stakeholders and
Company’s website.
promote its own sustainability. The Company is aware that corruption is a major obstacle to objective achievement and
Other than the codes, in 2010, Thaioil joined the project on Collective Action Coalition against Corruption in Private Sector (CAC). The coalition was initiated by the IOD, the Thai Chamber of Commerce, the Joint Foreign Chambers of
is also a problem to national country’s economic and social development. Therefore, in 2010, the Company signed its commitment to joining the “Private Sector Collective Action Coalition against Corruption”.
Commerce in Thailand, the Thai Listed Companies Association, the Thai Bankers Association, and the Federation of Thai
To achieve the objectives, the company defined its
Industries commerce. The project was also supported by
Anti-Corruption Policy, as well as roles, responsibilities,
the government and the Office of National Anti-Corruption
guidelines, and measures as follows:
Commission. Definition of the Anti-Corruption Policy In 2012, Thaioil joined the membership of the United Nations
Corruption means any action, whether offering, promising,
Global Compact (UNGC), which enabled it to apply the ten
soliciting, demanding, giving or accepting assets or other
UNGC principles, which are internationally recognized in
benefits to government officials or other persons in business
the promotion of good governance on human rights, labor,
dealing with the Company, whether directly or indirectly, as a
environment, and anti-corruption in its business operation.
motive for them to do or refrain from doing any act to acquire
In 2013, Thaioil defined an Anti-Corruption Policy by assigning definitions, roles, duties, responsibilities, guidelines, implementing measures of the supervision and control of
or keep benefits that are unsuitable to the business, except as allowed by the laws, rules, regulations, local customs or tradition, or business customs.
corruption in the organization. This was to show its concrete
Political Contribution means assistance, whether in cash
commitment to conducting business based on fairness,
or in-kind, to support political activities such as giving of
integrity, transparency, responsibility to society and all
objects or services, advertisement on the promotion or
stakeholders in compliance with Thaioil’s corporate governance
support of political parties, purchase of tickets to attend
principles and code of business conduct. Such policy has
fund-raising sessions, or donation to organizations close
been approved by the Corporate Governance Committee
to political parties.
and endorsed by the Board of Directors. Thaioil has communicated the policy to all employees through circulars
Anti-Corruption Policy
and internal magazines and sent policy notifications to
The Board of Directors (the Board), the management, and
customers and business partners, as well as announcing
employees must not corrupt or accept corruption of all forms
the policy in its website for the interested public.
in any circumstances, covering the business of the Company
The company’s anti-corruption policy is as follows:
in every country and in every relevant agency. The Company defines guidelines, operating measures, and roles and duties
Anti-Corruption Policy
of responsible persons, as well as regularly monitoring and
The Company is committed to basing business on fairness,
reviewing the implementation of the anti-corruption policy in
integrity, transparency, responsibility to society and all
compliance with changes in businesses, rules, regulations,
stakeholders, in compliance with its corporate governance
and relevant laws.
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Roles and Responsibilities
ANNUAL REPORT 2014
2. In dealing with major corruption risks, the Company
Apart from the strict implementation of the policies, guidelines,
ensures that directors, the management, and employees
and measures, the Company defines the roles and duties of
cautiously perform the following duties:
the Board, Board-Committees, and Management as follows: 2.1 Political Contribution - The Company’s policy is 1. The Board of Directors must define policies, supervise, follow up, as well as allocating sufficient and suitable resources to ensure that the Company meets the objective of implementing the anti-corruption policy.
politically neutral, with no support or action that supports political parties, whether directly or indirectly, as well as the use of the Company’s resources in activities that cause the Company to lose its political
2. The Corporate Governance Committee must review the policies as necessary in line with changes in businesses,
neutrality and/or sustain damage by participating in such activities.
rules, regulations, and relevant laws, approve any improvement or modification before submitting it to the
2.2 Charitable Contribution and Sponsorship - The
Board for approval; as well as providing comments and
Company’s policy is to control charitable contributions
recommendations that benefit the management in the
and sponsorships in various forms to ensure that the
preparation of operating plans and the implementation
activities will not lead to corruption. The Company sets
of the measures.
up procedures and control that are clear, concise,
3. The Audit Committee must monitor the operation of the Company in line with anti-corruption measures, including
efficient, and able to check and follow documents and proofs.
financial reports, internal control system, and internal audit to ensure that the operation of various departments
2.3 Gifts, Hospitality, and Expenses - The Company
are efficient, lawful, and in compliance with ethical rules,
determines that exchanging gifts and entertainment
regulations, and standards.
must be suitably done according to tradition but
4. The Management must implement the policies, support resources, communicate and encourage all employees and all relevant persons to understand the policies, guidelines, and measures, encourage and support the Company’s subsidiaries to apply the anti-corruption policy and measures as appropriate, implement the views and recommendations of the Board and the Board-Committees, review the suitability of various systems and measures, as well as reporting to the Board and/or to the Board-Committees accordingly. Implementation
within reasonable value. They must not induce to act or refrain from acting that may lead to malfeasance and corruption. Measures 1. The Board, the management, and employees must comply with the anti-corruption policy and measures, the Company’s corporate governance principles and code of business conduct, by not involving in corruption, whether directly or indirectly. 2. Employees should not neglect or ignore, or when they
1. In implementing the policies, refer to the guidelines set
face or doubt any act that is considered corruption by
by the Company in the corporate governance manual and
notifying supervisors or responsible persons or through
code of business conduct, as well as rules, regulations,
suitable report channels and cooperate in the fact-finding
and relevant manuals on business operation.
investigation stipulated by the Company’s regulations.
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3. The Company will provide fairness and protection of
9. The Company sets up a Corporate Authorization
employees who refuse or inform about the corruption
Procedure that is clear, concise, efficient, transparent,
relevant to the Company’s activities, by not demoting,
and open to scrutiny.
punishing, or causing negative impacts. The Company will strictly provide protection to the complainant or
10. The Company sets up an internal control system
the person who cooperates in reporting corruption as
covering finance, accounting, data entry, as well as
defined in the policy and personnel guidelines and/or
other organizational processes, which is relevant to
the Company’s complaint and whistle-blowing measures.
anti-corruption measures. The Company also ensures that internal control findings are communicated to
4. Corrupt persons violate the Company’s code of conduct
responsible personnel.
and must face punishment under the Company’s rules and may also face prosecution if the action violates the law.
11. The Company sets up an internal audit system covering major activities, including commercial operation, and procurement to ensure that the system meets the
5. The Company communicates its anti-corruption policy
objectives, as well as monitoring the operation so that
and measures, including channels of whistle-blowing, complaint or recommendations within the Company through various means such as orientation of new directors and employees, the intranet, or newsletter to forge understanding in the implementation of the policy. 6. The Company communicates anti-corruption policy
it complies with rules, work practices, regulations, and, finally, provide recommendations on the improvement of processes for greater efficiency. To ensure their readiness before undergoing self-assessment for anti-corruption measures, the Company instructed
and measures, including channels of whistle-blowing,
its related directors and employees to join a seminar on
complaint, or recommendations to the public and
self-assessment guidelines and enroll in the Anti-Corruption
stakeholders through various means such as the
for Executive Program (ACEP) and the Anti-Corruption: The
Company’s website or annual report.
Practical Guide (ACPG) courses, both organized by IOD.
7. The Company sets up risk management on anti-corruption
This year, the Company developed a self-assessment
by assessing and ranking risks, and defining suitable
form for anti-corruption measures, which accompanies
measures, as well as following up on the implemented
supporting evidence related to business policy, measures
measures.
and procedures, and its internal control system. All documents were submitted to the CAC panel as part of Thaioil’s
8. The Company sets up personnel management processes to reflect its commitment to the anti-corruption policy and measures, from the selection of personnel, training, performance assessment, compensation, promotion, to an organizational structure with suitable division of duties for checks and balances, as well as ensuring sufficient and suitable skilled resources and personnel to implement the policy.
application for CAC membership. The Company earned such membership on April 4 this year, a proof of its commitment to transparent business through continual upgrading of its work processes, which promotes Thaioil’s good image and confidence among stakeholders.
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Guidelines and Enforcement
that are affected or potentially affected by the Company’s
The Company has defined the duties and responsibilities
business or conduct of its directors, executives, or employees
for directors, the management, and all employees to
resulting from law-breaking or violation of the code of
acknowledge and comply with the policies and terms of this
conduct, as well as suspected corrupt practices. This year,
manual. All executives are to supervise, take responsibility
the Company modified the measures for complaints and
for, and seriously take the promotion of their understanding
whistle-blowing for clarity in receiving them and for greater
and strict compliance with this manual.
confidence on the part of complainants and whistle-blowers spelled out in their protection measures, as well as protection
The Company is to stringently obey the law while refraining
of related parties.
from violating these principles. If directors, the management, and employees violate these principles, they will face strict disciplinary punishment; if it is suspected that they have violated any law, regulation, rule, and requirement lay down by the public sector, they will be handed to public officials for prosecution. If employees find it difficult to decide on any given matter or deal with any portion of the code of conduct not explicitly stated in the Company’s code of conduct, they should ask themselves the following questions: 1) Is this action against the law? 2) Is this action against a company policy, its code of
Stakeholders, employees, related officers, or external parties that come across or are aware of clues, as well as those affected by Company’s business or by the job performances of Thaioil directors, executives, and employees in the violation of laws, government regulations, corporate governance policy, the code of conduct, Company’s policies or regulations, or suspicious acts, can file complaints. Thaioil encourages complainants to identify themselves and provide adequate evidence. Complainants can file their cases by clearly spelling out “Confidential” through the following channels:
conduct, or its image? 3) Is this action going to severely affect the company’s stakeholders? 4) Is this action socially acceptable and disclosable?
Chairman of the Board / Chairman of the Corporate Governance Committee / Chairman of the Audit Committee / Chief Executive Officer / Company Secretary
If employees detect violation of the law or the corporate
Thai Oil Public Company Limited
governance principles, or both, they are to inform the
555/1 Energy Complex Building A, 11 th Floor
channels under the whistle-blowing measures about it, and
Vibhavadi Rangsit Road, Chatuchak, Chatuchak,
t h e C o m p a n y w i l l b e g i n i t s p ro b e , w h i l e p ro t e c t i n g
Bangkok 10900
whistle-blowers. cgcoordinate@thaioilgroup.com Whistle-Blowing Measures and Whistle-Blower Protection
(The Corporate Governance Manager will acknowledge
Mechanism
receipt of the matter and duly forward it to responsible
The Company has put in place complaint-making and
parties.)
whistle-blowing channels, covering complaint-filing, verification, and summary of findings, together with protection of the complainants and related parties. The purpose is to handle complaints, comments, or suggestions from stakeholders
+66(0)-2797-2900 or +66(0)-2797-2999 or +66(0)-2299-0000 ext. 7440-7442 +66(0)-2797-2973
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Thaioil has clearly defined complaint-making and
Company will punish them under its regulations or the law,
whistle-blowing processes, to be publicized in the Corporate
or both, as seen fit.
Governance and Code of Conduct Manual (Revision 4) and on the Company’s website, with the following procedure:
This year, no complaint was filed about the Company’s non-compliance with the law. No fine, non-cash liability, or
1. Violations of personnel aspects of Company’s policies and
corrupt practice case was reported.
procedures should be forwarded to the Human Resources Manager
Article 4: Disclosure and Transparency The Company shall discloses all key information, including
2. Violations of laws, regulations, company policy and principles of corporate governance, code of conduct, or regulations should be forwarded to the Company Secretary
externally audited financial information prepared under generally accepted accounting standards, non-financial information, and related information in an accurate, complete,
3. Dubious acts for unlawful gains for oneself or other parties,
timely, and transparent way through readily accessible
including embezzlement, corrupt practices, and fraud
channels that are fair and credible in both Thai and English.
should be forwarded to the Audit Committee or the Corporate Internal System Audit Manager
Disclosure Information of Board of Directors and Executive Management Remuneration Fee and Shareholding
4. If the matter under (1), (2), or (3) is complicated or involves several units, it should be forwarded to the CEO/President, who will appoint an investigation committee
Information of the Board of Directors and executive management remuneration fee and shareholding must be reported in the Annual Registration Statement (Form 56-1)
5. Then this should be forwarded to the Corporate Governance
and Annual Report (Form 56-2). Under Article 59 of the
Manager for complaint registration and information
Securities and Securities Exchange Act, directors and
recording for progress follow-up.
executives must report their share portfolios with each purchase, sale, or transfer of shares to SEC. In addition,
Note that if a violation is proved valid, the guilty party is subject to the Company’s disciplinary measures or punishment by law if the violation is unlawful, or both.
the Company’s key guideline is to promote the oversight of the use of inside information. The Company issued reminders for directors and executives to refrain from buying,
Protection of Complainants, Whistle-Blowers, and Related
selling, or transferring their shares at least a month ahead
Parties
of performance report submission to SET for each quarter.
Complainants or whistle-blowers are to be suitably and fairly protected by the Company, which implies no change in job titles, job nature, workplaces, job relief, threats, job harassment, dismissal, or unfair acts. The Company will keep their complaints confidential and not disclose them to unrelated parties except when required by law.
The Company also set policy for directors to report each purchase, sale, or transfer of shares to the Board at each meeting. In addition, directors and executives must report changes in their vested interests to the Company every quarter, and update their reports every year. Such information is to be kept within the Company to conform to the Capital
Those with knowledge of complaints or related information
Market Supervisory Board’s announcement, Tor Jor 2/2009
must maintain confidentiality and not disclose it except
in regards to the report on vested interests of directors,
when required by law. If this is intentionally violated, the
executives, and related parties.
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Disclosure Information of the Company
ANNUAL REPORT 2014
>>
The Company shall disclose information on material matters regarding the Company, including financial reports,
About Thaioil comprises of visions, missions, business and products, organization charts, etc.
>>
non-financial information and other information as stipulated
Corporate Gover nance comprises of policies and p r i n c i p l e s , c o d e o f c o n d u c t , B o a rd o f D i re c t o r s ,
by SET and SEC that are accurate, clear, complete, easy
Board-Committees, Management, Board Charters, etc.
to understand, transparent, adequate, reliable and timely, and which have been screened according to prescribed
>>
stock information, shareholder information, etc.
procedures. The Company disclosed information to ensure equitable access by shareholders in the following channels: >>
SET and SEC’s Community Portal system
>>
Company’s website at www.thaioilgroup.com
>>
Annual Registration Statement (Form 56-1) and Annual
Investor Relations comprises of financial information,
>>
Corporate Social Responsibility comprises of policies, activities, communication channels, etc.
>>
Corporate News comprises of executives in the news, advertisements, articles from the CEO/President, etc.
Report (Form 56-2) >>
Public channels such as newspapers, magazines, television, and the Company’s journal
Use of Inside / Confidential Information The Company has provided the responsibility of the Board of Directors to report on financial statements along with the auditors’ report in the annual report, as well as taking
>>
Company’s site visit and analysts meetings
>>
Road shows for both domestic and overseas investors
Employees must not apply the Company’s confidential
>>
Annual exhibition such as SET in the City and Money
information for personal or others’ gains. They should maintain
Expo
inside information and sensitive documents that could lead
preventative measures on the use of confidential information.
to undue exploitation for themselves, their families, or their >>
Invitation to the AGM via post
>>
Preparation of e-news to report on quarterly performance
prices and the Company’s proprietary commercial secrets,
and announcement via the Company’s website
formula, and inventions. Those who disclose important
Press conferences on the Company’s performance
information and news to outsiders without approval from the
outcomes and financial standing, together with its business
CEO/President shall be subject to disciplinary action according
plans, key projects, state of the industry, and competition
to Company’s procedures and may face legal action.
associates, including any information influencing stock
>>
outlooks. Two press conferences were held this year. Investor Relations Information Disclose in the Company’s Website
Thaioil attaches great importance to investor relations which
To ensure that the shareholders, investors, and interested
is performed duties with utmost responsibility, integrity, and
persons can quickly search and retrieve the Company’s public
dedication on disclosure of correct, reliable and adequate
information, the Company provided the following information
Company information to investors, analysts and other related
in both Thai and English via Company’s website.
parties in a fair, transparent and comprehensive manner.
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The Company has set up the Investor Relations (IR)
Investor Relations
Department as a focal point in conducting proactive investor
Thai Oil Public Company Limited
relations activities, according to best practices of leading
555/1 Energy Complex Building A, 11 th floor
international organizations, to promote effective communication
Vibhavadi Rangsit Road, Chatuchak, Chatuchak,
channels with investors, analysts and other related parties
Bangkok 10900
through various channels, such as
ir@thaioilgroup.com
>>
Organize analyst meetings quarterly
>>
Participate in the SET’s Opportunity Day to report on the
+66(0)-2797-2961 (Direct) or +66(0)-2797-2999 or +66(0)-2299-0000 ext. 7370, 7372-4
result of performance quarterly >>
+66(0)-2797-2976
Set up the IR Cor ner in the 2014 AGM to provide information and response to the shareholders’ enquiries
Article 5: Board Responsibilities The Board of Directors of the Company has a significant role
>>
>>
Provide shareholders and institutional investors to visit
as a representative of the shareholders in establishing and
the refinery and meet business executives in order to
reviewing vision, mission, strategic plans, and budget for the
generate understandings in the business of the Company
management to achieve its objectives as planned and in line
Participate in annual exhibition organized by SET in providing educate and promoting knowledge to investors in Money Expo and SET in the City
with rules and regulations with utmost integrity. Appointed by the shareholders in a transparent process, the Board must consist of directors, who have knowledge, expertise, and experience in matters of benefit to the Company and
>>
Publish the TOP-IR e-newsletter (Thaioil’s quarterly
must be responsible to the shareholders for performing
journal) to report on the Company’s operating results, oil
with integrity and freely expressing views, while keeping
analysis, social responsibility and corporate governance
themselves updated for the Company’s best interests and
aspects of the Company through its website quarterly
fairness to shareholders. Directors must devote reasonable periods of time to their assignments. They should also exert
The IR Department shall report on the operations of investor
leadership, command visionary thinking, decide matters
relations to the Board of Directors at least once a year.
freely, and ensure work systems that can ensure legal and
Interested parties can request this information from the IR
ethical activities. The Board must be free of the management
Department via the following channels:
through a clearly defined separation of responsibilities. The structure of the Board, consisting of the composition and qualifications of directors, their nomination procedures, qualifications of independent directors, nomination and selection of the executive officer, is found under the Directors and Executive Director Nomination Section on page 109-110.
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Board Meetings
regulations, and shareholders’ resolutions. An approval
Board meetings are scheduled in advance so that directors
framework has been clearly defined for the Board and
can schedule themselves to attend. In consultation with the
the management on various matters, including personnel
CEO/President, Chairman of the Board must endorse each
administration, finance, and accounting.
meeting and its agenda. Other significant matters proposed by directors are also considered. The Company is responsible
In addition, the Board endorses the Company’s vision, missions,
for preparing and delivering the meeting agenda and relevant
and strategies through the annual Strategic Thinking Session
documents to all directors well in advance. Given adequate
(STS), designed to enable the Board and senior executives
preparation time, directors must investigate and make sound
to jointly review Thaioil Group’s short-term and long-term
decisions.
strategic plans for alignment with the business directions, prevailing circumstances, and outlooks. They also provide
The Company’s regulations call for the board to meet at least once a quarter, with at least half of the total board in attendance to make a quorum, with additional meetings as
comments and approve the annual business plans and budgets, together with Thaioil Group’s key business directions and policies.
necessary. In 2014, the Company managed a total of 13 Board of Directors’ Meetings, one independent directors meeting, and one directors meeting with the absence of executive directors without the management. Meeting invitations are delivered to directors at least seven days prior to meeting date to give them enough time to study, deliberate, make sound decisions on all agenda items, and schedule themselves properly to attend each meeting, as well as protect the rights and benefits of the Company. The Company encourages the directors to independently and openly express their opinions during the meeting. Minutes of Board meetings, including its meeting outcomes and the Board’s views, must be made clear for future reference. Senior management team members should attend Board
Remuneration of Directors It is the Company’s policy to compensate directors at reasonable levels to motivate and retain quality directors, or at levels comparable to industrial practices. Remuneration is linked to the director’s performance and responsibility as well as the Company’s performance and benefits to the shareholders. Directors tasked with greater responsibilities are paid more for such extra responsibilities. Chairman may likewise receive higher compensation than directors. The Nomination and Remuneration Committee sets the remuneration principles, payment method, and reports the nomination and remuneration performance to the Board of Directors for approval at the AGM.
meetings to provide additional relevant information and allow the Board to get to know them, which will be useful for their
The details on remuneration of directors for the year 2014
review of succession plans.
can be found in Assets and Shareholders Information and Management Structure on page 80.
This year, the Board revised the guidelines for deliberation of agenda items concerning directors with vested interests for Board meetings so that suitable guidelines compatible with corporate governance principles may be in force.
Board’s Performance Assessment The annual performance assessment is done in three steps, namely:
Board Approval Authority
1) Individual Director Assessment (Self-Assessment)
The Board is authorized to approve the Company’s various
2) Board and Board-Committees Assessment and
businesses under the scope given by law, Company’s
3) Peer Assessment
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The Company’s new appraisal form covers additional significant
Comparison of the Performance
criteria as follows:
Assessment of the Board of Directors
(%)
1) Board Policy
Form 1 : Individual Director Assessment
98
Excellent
97
Excellent
98
Excellent
2) Board Composition and Qualification 3) Board Meeting
2014
(Self-Assessment) Form 2 : Board and Board-Committees
4) Practices, Roles, Duties and Responsibilities of the Board, which consist of preparedness of the Board, the risk management and internal control, handling of conflicts of
Rating
Assessment : Corporate Governance Committee Assessment
interest, financial control and monitoring, selection process,
: Audit Committee Assessment
99
Excellent
compensation process, and performance appraisal.
: Nomination and Remuneration
98
Excellent
98
Excellent
99
Excellent
The Board assigns the Corporate Governance Committee to endorse such forms annually to ensure that they are complete and align with prevailing circumstances. This year, the Corporate Governance Committee endorsed the disclosure of assessment outcomes of the four committees in the annual report. It has also amended the assessment
Committee Assessment : Risk Management Committee Assessment Form 3 : Peer Assessment The company randomly selected assessors for each of the directors
forms for the entire Board and the committees for clarity, encompassing the performance of the committees and their
The overall result of the 2014 Board’s assessment indicates
mandates specified in their charters so as to conform to the
an average rating of “excellent” at the score of 98%.
assessment criteria for the Corporate Governance Report of IOD and that for the ASEAN CG Scorecard.
The Company must present the results and comments of the directors in each category to the Corporate Governance
The criteria for the evaluation represent the percentage in
Committee and the Board of Directors to form the basis
each article as follows:
for improving the performance of the Board in the future.
Over 85%
=
Excellent
The CEO/President also participate in explaining his
Over 75%
=
Very Good
expectations for support from the Board.
Over 65%
=
Good
Over 50%
=
Satisfactory
Under 50%
=
Poor
Chief Executive Officer and President’s Performance Assessment and Remuneration The Nomination and Remuneration Committee, in charge of
The 2014 Performance Assessment of the Board of Directors
the annual performance assessment of the CEO/President,
can be summarized as follows:
must forward the assessment outcome to the Board for endorsement. Therefore, the performance assessment of the CEO/President is considered as confidential information and cannot be disclosed. The performance assessment for the CEO/President has 3 parts as follows:
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ANNUAL REPORT 2014
Part 1 - Corporate Key Performance Indicator (KPI) Achievements
Development of Directors and Executives
Part 2 - Leadership Competency
The Company has promoted and provided support to
Part 3 - Efficiency on Budget and Project Management
training and education on corporate governance to directors, committee members, executives, the company secretary,
The performance appraisal outcome, dictating the pay rise for the CEO/President, is presented to the Board for further approval. However, the outcome of this assessment is confidential and cannot be disclosed.
and others as part of continuous operational development. The Company also has a continuing development program for executives to groom them for internal rotation, ranging from section, division, to department managers, and for
The CEO/President remuneration is linked to his or her
succession for the CEO/President and assistant executive
performance, responsibilities, Company’s performance,
vice presidents upward through capability assessment of
and benefits produced for the shareholders, the Company’s
senior executives as well as put a mentoring program in
policy is to make such pay attractive and on a par with
place to groom department managers upward and groom
peer companies of the same industry. The Nomination
senior executives for succession. Moreover, the GLDP
and Remuneration Committee appraises the CEO/President
(Group Leadership Development Program) of PTT was
annual performance against the goals previously set and
designed to undergo individual assessment of competency,
agreed with him or her. These goals include financial
readiness, and strengths/weaknesses conducted by a
performance, operating performance, long-term strategic
third-party assessor. It also develops individual development
objectives, and executive development performance. The
plans for executives.
committee then recommends its findings to the Board for endorsement, and the Board Chairman then informs the CEO/President about the decision.
In summary, in 2014, Thaioil complied with all elements of the corporate governance policy for listed companies as required by SET except for the following points. First, cumulative
Orientation for New Directors
voting: Thaioil’s Regulation, Section 5, Item 17, says one
The Company prepared orientation documents for new
share carries one vote, and each shareholder may choose to
directors to provide information including business struc-
exercise all of his or her votes for one or more directors, but
tures, strategic plans, corporate governance policy and
may not divide his or her votes for any preferred candidate.
framework, code of conduct, etc. This information will
Second, the number of directors: Under the CG principles,
be useful for their job performance and staged orienta-
the Board of Directors consists of 5-12 directors, whereas
tion to introduce its business and business directions for
as of December 31 this year, Thaioil’s Board consisted of 14
new directors. The CEO/President along with other senior
directors. This followed Thaioil Regulation, Section 5, Item
executives will provide business-related information that is
16, which says the Board is to contain no less than five and
beneficial to the performance of the directors. Moreover,
no more than 15 directors to enable the Board to command
the Company encourages directors to undergo IOD training
a proper size for its complexity. The Board should be made
courses to support and promote their job performance.
up of competent directors with extensive credibility, while they should be diverse in background, including industrial, finance and accounting, business, management, strategic, legal, and good governance, among others.
Director
Director / Member of the Risk Management Committee and Chief Executive Officer and President
Mr. Chansin Treenuchagron
Mr. Atikom Terbsiri
DCP 158/2012
Independent Director and Chairman of the Audit Committee
Independent Director and Chairman of the Nomination and Remuneration Committee
1 Mr. Apisit Rujikeatkamjorn
2 Mr. Wisan Wuthisaksilp
Directors who completed the term at the AGM 2014 (April 2 , 2014)
Member of the Risk Management Committee (Resigned December 31, 2014)
DCP 125/2009
DCP 166/2012
DCP 82/2006
Independent Director and Member of the Nomination and Remuneration Committee (Resigned September 1, 2014)
5 Gen. Trisak Indararusmi
DCP 158/2012
7 Mr. Veerasak Kositpaisal
Independent Director and Member of the Corporate Governance Committee (Resigned August 29, 2014)
4 Pol.Gen. Adul Sangsingkeo
DCP 176/2013
Director (Resigned September 1, 2014)
3 Mr. Somkeirt Hudthagosol
DCP 155/2012
DCP 115/2009 DCP 85/2007 DCP 125/2009
DCP 18/2002
DCP 91/2007
DCP 80/2006
DCP 129/2010
DCP 108/2008
DAP 27/2004
DAP 93/2011
DAP 52/2006
DAP 73/2008
DAP 16/2004
DAP 60/2006 DAP 40/2005
DAP 64/2007
Director Accreditation Program (DAP)
ACP 22/2008
ACP 40/2012
ACP 22/2008
ACP 37/2011 ACP 39/2012
ACP 32/2010 ACP 17/2007
Audit Committee Program (ACP)
RCC 14/2012
RCC 12/2011
Role of the Compensation Committee (RCC)
RNG 3/2012
RNG 3/2012
Role of the Nomination and Governance Committee (RNG)
RCP 26/2011
RCP 21/2009
RCP 28/2012
Role of the Chairman Program (RCP)
FSD 6/2009
FSD 17/2012
FSD 15/2012
FSD12/2011
FSD 10/2010
Financial Statements for Directors (FSD)
FND 24/2005 UFS 5/2006
FND 30/2006
AACP 16/2014
ACEP 10/2014
AACP 9/2012 SFE 14/2012 MFR 16/2012 MFM 8/2012 MIA 13/2012 MIR 13/2012 HRP 1/2012 HMS 1/2012
CDC 6/2012
FND 30/2006
UFS 8/2007
FND 7/2003 UFS 1/2006 DCP Refresher 1/2008 FGP 4/2012 DCP-Refresher 2006 FND 28/2006 FGP 4/2012 ACEP 10/2104 ACCP 10/2014
Others
ANNUAL REPORT 2014
6 Ms. Chanatip Weerasubpong Independent Director and Member of the Audit Committee Resigned (September 1, 2014)
Independent Director and Member of the Audit Committee (Resigned September 1, 2014)
2 Mr. Tanawat Ampunant
Directors who resigned during the year 2014 1 Mr. Norkun Sitthiphong Director and Chairman of the Board (Resigned June 16, 2014)
13 14
Director and Member of the Risk Management Committee
Director and Member of the Corporate Governance Committee
9 Mr. Yongyut Jantararotai
12 Mr. Twarath Sutabutr
Independent Director and Chairman of the Corporate Governance Committee and Member of the Nomination and Remuneration Committee
8 Mr.Thosaporn Sirisumphand
Independent Director and Chairman of the Risk Management Committee
Director and Member of the Nomination and Remuneration Committee
7 Mr. Nuttachat Charuchinda
11 Mr. Apisak Tantivorawong
Independent Director and Member of the Nomination and Remuneration Committee
6 Mr. Thaworn Phanichaphan
Independent Director and Member of the Corporate Governance Committee
Independent Director and Chairman of the Nomination and Remuneration Committee
5 Gen. Jiradej Mokkhasmit
10 Mr.Praipol Koomsup
Independent Director and Member of the Audit Committee
4 Ms. Chularat Suteethorn
DCP 12/2002 DCP 72/2006
Independent Director and Member of the Audit Committee
3 Mr. Suvit Maesincee
DCP 35/2003
Independent Director and Chairman of the Audit Committee
2 Mr. Chulasingh Vasantasingh
Position
Director and Chairman of the Board
Director
1 Mr. Kurujit Nakornthap
Director Certification Program (DCP)
The Company’s Directors have attended courses organized by the Thai Institute of Directors (IOD) as follows:
THAI OIL PUBLIC COMPANY LIMITED
Corp orat e Gove rnance Report
131
132
THAI OIL PUBLIC COMPANY LIMITED
Co rpo ra t e Go v erna nce R e p o r t
ANNUAL REPORT 2014
Other training Course in year 2014 No. Name-Surname 1 Ms. Chularat Suteethorn
Position
Training Course in year 2014
Independent Director /
>>
Member of the Audit Committee
Anti-Corruption for Executive Program (ACEP 10/2014)
>>
Advanced Audit Committee Program (AACP 15/2014)
2 Mr. Thosaporn Sirisumphand
Independent Director /
>>
Chairman of the Corporate Governance Committee /
Executive Program, Energy Education, Thailand Energy Academy (Class 4/2014)
>>
Corporate Governance Program:
and Member of the Nomination
Effectiveness and Accountability in the
and Remuneration Committee
Boardroom, Kellogg School of Management, Northwestern University, U.S.A. (2014)
3 Mr. Chansin Treenuchgron
Director
>>
Leadership Development Program (LDP 1/2014)
>>
The National Defence College (NDC 57/2014)
4 Gen. Trisak Indararusmi
Independent Director /
>>
Member of the Nomination
Anti-Corruption for Executive Program (ACEP 10/2014)
and Remuneration Committee (Resigned on September 1, 2014) 5 Ms. Chanatip Weerasubpong
Independent Director /
>>
Member of the Audit Committee
Advanced Audit Committee Program (AACP 16/2014)
(Resigned on September 1, 2014) 6 Mr. Veerasak Kositpaisal
Director / Member of the Risk Management Committee / And Chief Executive Officer and President (Resigned on December 31, 2014)
>>
Executive Program, Energy Education, Thailand Energy Academy (Class 5/2014)
THAI OIL PUBLIC COMPANY LIMITED
21
133 T h ai oi l Grou p ’s Soc i al Res pons ibility
ANNUAL REPORT 2014
THAIOIL GROUP’S SOCIAL RESPONSIBILITY
Thaioil Group discloses its policies and operation illustrating social and environments responsibility in its Sustainability Report 2014 For this edition of the Sustainability Report 2014, The Company selected the contents under the Materiality Assessment of Global Reporting Initiative (GRI) G4, the latest international standard for reporting the approach and performance of environment, social, and economic matters. The Company also adheres to additional reporting guidelines about the Oil and Gas Sector Supplement by disclosing comprehensive information as required. The report also show progress in compliance with the 10 universal principles of the United Nations Global Compact (UNGC).
134
THAI OIL PUBLIC COMPANY LIMITED
Co rpo ra t e Info rma t i o n
22
ANNUAL REPORT 2014
CORPORATE INFORMATION
Thai Oil Public Company Limited Symbol
TOP
Registration Number
0107547000711
Business
Thaioil is Thailand’s largest refinery and supplier of petroleum products. Founded in 1961, we operate one of the most efficient refineries in Asia-Pacific with a current refining capacity of 275,000 barrels per day. To complement our core oil refining business, we engage through our subsidiary companies in related businesses of aromatics, LAB : an intermediate in the production of surfactants such as detergents, lube base oil refinery, power generation, marine and pipeline transportations of crude, petroleum and petrochemical products, renewable energy, solvents and provide recruitment services.
Registered Capital
20,400,278,730 Baht Comprising 2,040,027,873 fully paid-up common shares of 10 Baht per share
Number of Employees
770 persons (as at December 31, 2014)
Address
Bangkok Office th
555/1 Energy Complex Building A, 11 Floor, Vibhavadi Rangsit Road, Chatuchak, Chatuchak, Bangkok 10900, Thailand Telephone : +66(0)-2797-2999, +66(0)-2797-2900, +66(0)-2299-0000 Fax
: +66(0)-2797-2970
Sriracha Office and Refinery 42/1 Moo 1, Sukhumvit Road Km.124, Tungsukla, Sriracha, Chonburi 20230, Thailand Telephone : +66(0)-3840-8500, +66(0)-3835-9000 Fax
: +66(0)-3835-1554, +66(0)-3835-1444
Website
www.thaioilgroup.com
Investor Relations
Telephone : +66(0)-2797-2961 E-mail
: ir@thaioilgroup.com
75
(Shareholding
manufacturing business
Vibhavadi Rangsit Road, Chatuchak,
Chatuchak, Bangkok 10900, Thailand
Fax : +66(0)-2797-2970
Tel : +66(0)-2299-0000, +66(0)-2797-2999
and petrochemical
Investment in solvent
555/1 Energy Complex Building A, 11 Floor,
th
distributor
THB
1,250,000,000
10
THB/Share
100
ANNUAL REPORT 2014
Thaioil Solvent Company Limited
related products)
Fax : +66(0)-2797-2974
manufacturer and
detergents and its derivatives including
Chatuchak, Bangkok 10900, Thailand
Tel : +66(0)-2299-0000, +66(0)-2797-2999
Paraxylene)
125,000,000
10
THB/Share
100
100
(%)
Shareholding
through Thai
Common
465,496,500
THB/Share
10
THB/Share
10
Value of Share
surfactants such as
0105551116050
Common
257,241,416
175,789,073
(Issued)
Number of Shares
Vibhavadi Rangsit Road, Chatuchak,
THB
4,654,965,000
Common
Common
Type of Shares
in the production of
th
THB
2,572,414,160
THB
1,757,890,730
Registered Capital
555/1 Energy Complex Building A, 11 Floor,
LABIX Company Limited
Fax : +66(0)-3835-1320 LAB (an intermediate
distributor
Thailand
0105556110246
manufacturer and
Tungsukla, Sriracha, Chonburi 20230,
Tel : +66(0)-3835-1317-9, +66(0)-3835-1878
petrochemical
Upstream
105/12 Moo 2 Sukhumvit Road,
Thai Paraxylene Company Limited
Petrochemical Business
Fax : +66(0)-2797-2970
Tel : +66(0)-2299-0000, +66(0)-2797-2999
Chatuchak, Bangkok 10900, Thailand
distributor
Vibhavadi Rangsit Road, Chatuchak
Lube base oil
Business
manufacturer and
0105539103288
0107539000090
Registration Number
555/1 Energy Complex Building A, 11 Floor,
th
Thai Lube Base Public Company Limited
Lube Base Oil Business
Company Name and Address
General Information of the Subsidiaries and Affiliates
THAI OIL PUBLIC COMPANY LIMITED
Corp orate Information
135
Producer (SPP)
Small Power
Vietnam
distributor in
petrochemical
THB
2,810,000,000
VND
178,000,000,000
THB
180,000,000
THB
1,200,000,000
Registered Capital
Common
Common
Common
Common
Type of Shares
281,000,000
17,800,000
1,800,000
120,000,000
(Issued)
Number of Shares
THB/Share
10
VND/Share
10,000
THB/Share
100
THB/Share
10
Value of Share
73.99
Solvent)
through TOP
(Shareholding
100
Solvent)
through TOP
(Shareholding
80.52
Solvent)
through Thaioil
(Shareholding
100
(%)
Shareholding
Co rpo ra t e Info rma t i o n
Fax : +66(0)-2797-2970
Tel : +66(0)-2299-0000, 0-2797-2999
Chatuchak, Bangkok 10900, Thailand
Vibhavadi Rangsit Road, Chatuchak,
555/1 Energy Complex Building A, 11 Floor,
Thaioil Power Company Limited
Power Generation Business
Fax : +84-83827-9035
0105539103296
in Vietnam)
Dong Nai Province, Vietnam
th
(Registered
Go Dau Industrial Zones, Long Thanh District,
Tel : +84-83827-9030-4
472043000745
TOP Solvent (Vietnam) Limited Liability
Fax : +66(0)-2797-2983
Tel : +66(0)-2299-0003, +66(0)-2797-2993
Solvent and
distributor
Chatuchak, Bangkok 10900, Thailand
manufacturer and
Hydrocarbon solvent
Vibhavadi Rangsit Road, Chatuchak,
th
555/1 Energy Complex Building A, 11 Floor,
Sak Chaisidhi Company Limited
Fax : +66(0)-2797-2983
Tel : +66(0)-2299-0003, +66(0)-2797-2993
Chatuchak, Bangkok 10900, Thailand
distributor
Solvent and
Vibhavadi Rangsit Road, Chatuchak,
0105527011880
0105551116491
Business
petrochemical
th
Registration Number
555/1 Energy Complex Building A, 11 Floor,
TOP Solvent Company Limited
Company Name and Address
136 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
products
Tel : +66(0)-2361-7500
Fax : +65-6734-3397, +65-6734-5801
Tel : +65-6734-6540
Singapore 238873
Singapore)
(Registered in
391A Orchard Road #12-01104,
business
petroleum products
crude oil and
transportation of
USD
9,000,000
THB
970,000,000
THB
3,500,000,000
THB
11,237,256,000
Registered Capital
Common
Common
Common
Common
Type of Shares
9,000,000
97,000,000
350,000,000
1,123,725,600
(Issued)
Number of Shares
USD/Share
1
THB/Share
10
THB/Share
10
THB/Share
10
Value of Share
Marine)
through Thaioil
(Shareholding
100
100
100
Power)
through Thaioil
(Shareholding
27.71
and
11.88
(%)
Shareholding
ANNUAL REPORT 2014
#12-05 & 12-10, Ngee Ann City Tower A,
201021606H
Thaioil Marine International Private Limited
Fax : +66(0)-2361-7498-9 Investment in marine
petrochemical
22
petroleum and
transportation of
Provide marine
Floor, Sanphawut Road,
0105541047578
(SPP)
Bangna, Bangkok 10260, Thailand
nd
223/97 Country Complex Building A,
Thaioil Marine Company Limited
Transportation Business
Fax : +66(0)-2797-2974
Tel : +66(0)-2797-2999
Chatuchak, Bangkok 10900, Thailand
Vibhavadi Rangsit Road, Chatuchak
555/1 Energy Complex Building A, 11 Floor,
TOP SPP Company Limited
Fax : +66(0)-2140-4601 Small Power Producer
power business
Chatuchak, Bangkok 10900, Thailand
0105556198933
future projects in
Vibhavadi Rangsit Road, Chatuchak
th
invest and develop
Tel : +66(0)-2140-4600
generation, including th
Operate power
Business
555/2 Energy Complex Building B, 14 Floor,
0105556004811
Registration Number
Public Company Limited
Global Power Synergy
Company Name and Address
THAI OIL PUBLIC COMPANY LIMITED
Corp orate Information
137
in Singapore)
Harbourfront Tower One, Singapore 098633
fleet development as well as provide consultation on and development of crew Trustee
201202478W
(Registered in Singapore)
Bangna-Trad Road, Bangna, Bangna,
Bangkok 10260, Thailand
Tel : +66(0)-2331-0080-5
Fax : +66(0)-2331-0086
TOP-NTL Private Limited
5 Temasek Boulevard # 11-02
Suntec Tower Five, Singapore 038985
SGD
20,000
THB
3,000,000
THB
180,000,000
USD
18,000,000
Registered Capital
Common
Common
Common
Common
Type of Shares
20,000
30,000
1,800,000
18,000,000
(Issued)
Number of Shares
SGD/Share
1
THB/Share
100
THB/Share
100
USD/Share
1
Value of Share
Marine)
through Thaioil
(Shareholding
50
Marine)
through Thaioil
(Shareholding
33.3
Marine)
through Thaioil
(Shareholding
55
Pte. Ltd.)
International
Marine
through Thaioil
(Shareholding
50
(%)
Shareholding
Co rpo ra t e Info rma t i o n
Fax : +65-6361-0377
Tel : +65-6361-0383
and international
88 Soi Bangna-Trad 30,
Management
ship management
Company Limited
Thome Ship Management (Thailand)
Fax : +66(0)-2361-7498-9 Provide service on
Gulf of Thailand
Tel : +66(0)-2361-7500
0105551087343
and supplies in the
Bangna, Bangkok 10260, Thailand
22
services for crew
transportation
Provide marine
petroleum products
crude oil and
transportation of
Provide marine
Business
Floor, Sanphawut Road,
nd
223/97 Country Complex Building A,
TOP Maritime Service Company Limited
Fax : +65-6293-2080
0115554017087
(Registered
1 Harbourfront Place #13-01,
Tel : +65-6290-8405
201104774G
Registration Number
TOP-NYK MarineOne Private Limited
Company Name and Address
138 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
0105551121754
energy business
Tel : +66(0)-2299-0000, 0-2797-2999
Fax : +66(0)-2797-2970
THB
1,450,000,000
THB
40,000,000
THB
8,479,000,000
THB
150,000,000
Registered Capital
Common
Common
Common
Common
Type of Shares
145,000,000
4,000,000
84,790,000
1,500,000
(Issued)
Number of Shares
THB/Share
10
THB/Share
10
THB/Share
100
THB/Share
100
Value of Share
100
100
9.19
TOP-NTL)
through
(Shareholding
30
and
Marine)
through Thaioil
(Shareholding
35
(%)
Shareholding
ANNUAL REPORT 2014
Chatuchak, Bangkok 10900, Thailand
Vibhavadi Rangsit Road, Chatuchak
Invesment in ethanol and alternative
th
555/1 Energy Complex Building A, 11 Floor,
Thaioil Ethanol Company Limited
Fax : +66(0)-2797-2970
Tel : +66(0)-2299-0000, 0-2797-2999
Chatuchak, Bangkok 10900, Thailand
on recruiting management
555/1 Energy Complex Building A, 11 Floor,
Provide service
Vibhavadi Rangsit Road, Chatuchak,
th
Thaioil Energy Services Company Limited
Other Business
Fax : +65(0)-2533-2186
0105550078006
petroleum products
Lumlukka, Pathumthani 12150, Thailand
Tel : +65(0)-2991-9130-59
transportation of
Pipeline
Thai Petroleum Pipeline Company Limited 0105534002696
services
Fax : +66(0)-2331-0086
2/8 Moo 11, Lumlukka Road, Ladsawai,
product storage and transportation
Bangkok, 10260, Thailand
Tel : +66(0)-2331-0080-5
and petroleum
Bangna-Trad Road, Bangna, Bangna,
Provide large vessels
Business
for crude, feedstock
0105556123275
Registration Number
88 Soi Bangna-Trad 30,
TOP Nautical Star Company Limited
Company Name and Address
THAI OIL PUBLIC COMPANY LIMITED
Corp orate Information
139
and distribution
Klongtoey, Bangkok 10110, Thailand
consultation and services
Vibhavadi Rangsit Road, Chatuchak
Chatuchak, Bangkok 10900, Thailand
Fax : +66(0)-2537-3685
THB
150,000,000
THB
150,000,000
Common
Common
Common
Common
Common
Type of Shares
1,500,000
15,000,000
2,740,000
67,500,000
8,000,000
(Issued)
Number of Shares
THB/Share
100
THB/Share
10
THB/Share
1,000
THB/Share
10
THB/Share
100
Value of Share
20
20
Ethanol)
through Thaioil
(Shareholding
21.28
Ethanol)
through Thaioil
(Shareholding
30
Ethanol)
through Thaioil
(Shareholding
50
(%)
Shareholding
Co rpo ra t e Info rma t i o n
Tel : +66(0)-2537-3645
technique
Provide engineering
555 PTT Head Office, Building 2, 7 Floor
th
PTT Energy Solutions Company Limited
Fax : +66(0)-2140-2999
Tel : +66(0)-2140-2000
Thailand
0105554075621
services
Chatuchak, Chatuchak, Bangkok 10900,
th
4 -5 Floor, Vibhavadi Rangsit Road,
th
communication
IT and
555/1 Energy Complex Building A,
PTT ICT Solutions Company Limited
Fax : +66(0)-45-252-776 0105549076496
molasse) production and distribution
THB
cassava and
333 Moo 9, Nadee Subdistrict,
Nayear District, Ubonratchatani, Thailand
Tel : +66(0)-45-252-777
2,740,000,000
THB
675,000,000
THB
800,000,000
Registered Capital
Ethanol (from
Ubon Bio Ethanol Company Limited
Fax : +66(0)-2251-1138
Tel : +66(0)-2656-7761-3
molasse) production
Ethanol (from
Ratchadapisek Road, Klongtoey,
0345550000315
0105549129891
sugarcane and
th
191/18-25 CTI Tower, 26 -27 Floor,
th
Maesod Clean Energy Company Limited
Fax : +66(0)-2233-0441
Tel : +66(0)-2233-0444-5
cassava) production and distribution
Ethanol (from
Business
68 Soi Santipap, Sap Road, Sipraya,
0105539017543
Registration Number
Bangrak, Bangkok 10500, Thailand
Sapthip Company Limited
Company Name and Address
140 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
141
THAI OIL PUBLIC COMPANY LIMITED
Corp orate Information
ANNUAL REPORT 2014
Reference Securities Registrar
Auditors
Thailand Securities Depository Company Limited (TSD)
KPMG Phoomchai Audit Limited
The Stock Exchange of Thailand Building,
51 Floor, Empire Tower, 195 South Sathorn Road,
62 Ratchadapisek Road, Klongtoey, Bangkok 10110 ,
Bangkok 10120 , Thailand
Thailand
Tel : + 66 ( 0 )- 2677 - 2000
Tel : + 66 ( 0 )- 2229 - 2800 , + 66 ( 0 )- 2229 - 2888 (Call center)
Fax : + 66 ( 0 )- 2677 - 2222
Debenture Registrar and Principal Paying Agent
Other Services (Loss of Share Certificate,
Thai Military Bank Public Company Limited
Change of Particulars in Securities Register,
Head of Marketing & Sales Investor Services
and Other Shareholder Services)
3000 Phaholyothin Road, Chompon, Chatuchak,
Counter Service
Bangkok 10900 , Thailand
The Stock Exchange of Thailand Building, 1 Floor,
Tel : + 66 ( 0 )- 2299 - 1830
62 Ratchadapisek Road, Klongtoey, Bangkok 10110 ,
Fax : + 66 ( 0 )- 2299 - 1028
Thailand
st
st
Tel : + 66 ( 0 )- 2229 - 2888 (Call Center) Bangkok Bank Public Company Limited Head of Marketing & Sales Investor Services
or
333 Trinity Building, Silom Road, Bangkok 10500 , Thailand
Office of Registration Services
Tel : + 66 ( 0 )- 2230 - 1477 , + 66 ( 0 )- 2230 - 1478
Thailand Securities Depository Company Limited
Fax : + 66 ( 0 )- 2626 - 4545 - 6
The Stock Exchange of Thailand Building,
KASIKORNBANK Public Company Limited Head of Marketing & Sales Investor Services 400 / 22 Phaholyothin Road, Sam Sen Nai District,
Phaya Thai, Bangkok 10400 , Thailand Tel : + 66 ( 0 )- 2470 - 6662 Fax : + 66 ( 0 )- 2273 - 2279
62 Ratchadapisek Road, Klongtoey, Bangkok 10110 ,
Thailand Tel : + 66 ( 0 )- 2229 - 2870 - 80 Fax : + 66 ( 0 )- 2654 - 5642 , 66 ( 0 )- 2654 - 5645
142
THAI OIL PUBLIC COMPANY LIMITED
Tha i o i l Gro up B us i nes s S tr u c tu r e
23
THAIOIL GROUP BUSINESS STRUCTURE As of December 31, 2014
ANNUAL REPORT 2014
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
143 T h ai oi l Grou p Bu si n es s Structure
144
THAI OIL PUBLIC COMPANY LIMITED
Re v enue S t ruct ure
ANNUAL REPORT 2014
REVENUE STRUCTURE
24
Thaioil’s core earnings were derived from our refining business. Other revenue contributors were the lube base oil, petrochemical, power generation, oil and petrochemicals transportation and other businesses. (in million Baht)
Fiscal year ended December 31 % of Thaioil Operator (3)
2012 (Restated)
2013 (Restated)
2014
stake
Amount
%
Amount
%
Amount
%
A. Net Sales 1. Oil refining
TOP
-
434,850
96
409,229
98
389,779
99
2. Lube base oil
TLB
100
29,089
6
26,954
6
26,560
7
TPX
100
67,861
15
64,520
15
56,711
15
TP/IPT
74/24
15,949
4
5,416
2
5,219
1
TM
100
1,233
-
1,231
-
1,199
-
Thaioil Solvent
100
9,856
2
9,781
3
9,822
2
3. Petrochemical 4. Power generation
(5)
5. Oil and chemical product transportation services 6. Solvent (4) (4)
TET
100
615
-
1,505
-
1,703
-
TES
100
377
-
516
-
561
-
Less: Related party transactions
(113,573)
(25)
(104,577)
(25)
(101,465)
(26)
Total
446,257
98
414,575
99
390,090
98
7. Ethanol 8. Other
B. Net Derivative Gain on Hedging 1. Oil refining
TOP
-
892
-
1,292
-
2,218
1
2. Petrochemical
TPX
100
(2)
-
-
-
-
-
890
-
1,292
-
2,218
1
Total C. Net Foreign Exchange Gain (1) 1. Oil refining
TOP
-
1,927
1
-
-
872
-
2. Lube base oil
TLB
100
16
-
-
-
38
-
3. Petrochemical 4. Power generation (5) 5. Oil and chemical product
TPX
100
10
-
-
-
27
-
TP/IPT/TOP SPP
74/24/100
24
-
-
-
35
-
TM
100
3
-
-
-
3
-
Thaioil Solvent
100
-
-
21
-
1
-
-
996
-
transportation services 6. Solvent (4) Total
7 1,987
145
THAI OIL PUBLIC COMPANY LIMITED
Re ve nue Structure
ANNUAL REPORT 2014
(in million Baht)
Fiscal year ended December 31 % of Thaioil Operator (3)
2012 (Restated)
2013 (Restated)
2014
stake
Amount
%
Amount
%
Amount
%
D. Other Revenues (2) 1. Oil refining
TOP
-
2,047
1
3,086
1
3,222
1
2. Lube base oil
TLB
100
376
-
166
-
138
-
TPX
100
406
-
444
-
393
-
TP/IPT
74/24
919
-
35
-
23
-
TM
100
23
-
26
-
16
-
6. Solvent (4)
Thaioil Solvent
100
21
-
20
-
23
-
(4)
TET
100
24
-
24
-
22
-
TES
100
3. Petrochemical 4. Power generation
(5)
5. Oil and chemical product transportation services
7. Ethanol 8. Other
-
-
24
-
1
-
Less: Related party transactions
(1,649)
-
(1,751)
-
(1,753)
-
Total
2,167
1
2,074
1
2,085
1
451,301
100
417,941
100
395,389
100
Total revenues (A-D) Remarks: (1) Net foreign exchange loss in 2013.
(2) Comprises received interests, export tax subsidy, revenues from services provided to subsidiary companies, land lease, single buoy mooring service fee, oil storage tank lease etc. (3) TOP is Thai Oil Public Company Limited. TLB is Thai Lube Base Public Company Limited. TPX is Thai Paraxylene Company Limited, having interest in LABIX Company Limited. TP is Thaioil Power Company Limited, in which Thaioil increase ownership interest from 55% to 74% since December 4, 2012. IPT is Independent Power (Thailand) Company Limited, in which the shareholding of Thaioil is 56% through Thaioil Power and 24% held directly by Thaioil. On January 10, 2013, Independent Power (Thailand) Co., Ltd. and PTT Utility Co., Ltd. formed a new amalgamated company namely Global Power Synergy Co., Ltd. TOP SPP is TOP SPP Company Limtited. TM is Thaioil Marine Company Limited, having respective interests in Thaioil Marine International Pte. Ltd., TOP Maritime Service Co., Ltd. Thaioil Solvent is Thaioil Solvent Company Limited, having respective interests in TOP Solvent Co., Ltd., Sak Chaisidhi Co., Ltd. and TOP Solvent (Vietnam) LLC. TET is Thaioil Ethanol Company Limited, having interests in Sapthip Co., Ltd. TES is Thaioil Energy Services Company Limited. (4) To apply retrospectively the change in basis of presentation in respect of the following segments: Solvent segment and Ethanol segment which have been adjusted to present separately from Petrochemical segment and other segment in 2012. (5) The impact of changes in accounting policy retrospectively in the financial statements of companies in the power generation business.
146
THAI OIL PUBLIC COMPANY LIMITED
M a na g ement ’s D i s cus s io n a n d A n a ly s is o f Fin a nci a l P o s i t i o n a nd O p e r a tin g R e s u lts
25
ANNUAL REPORT 2014
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND OPERATING RESULTS
Consolidated Results 2014
2013 (1)
Change
GIM excluding stock gain /loss (2)
USD/barrel
6.2
6.8
(0.6)
(2)
USD/barrel
1.9
7.6
(5.7)
Million Baht
390,090
414,575
(24,485)
Million Baht
2,218
1,292
926
Million Baht
2,651
22,337
(19,686)
Finance Costs
Million Baht
(3,966)
(3,786)
(180)
Net Foreign Exchange Gain / Loss
Million Baht
996
(3,111)
4,107
GIM including stock gain / loss Sales revenue
Net Derivative Gain / Loss on Hedging EBITDA
Income Tax Expense / (Reversal)
Million Baht
920
(1,160)
2,080
Million Baht
(4,026)
9,316
(13,342)
Baht / Share
(1.97)
4.57
(6.54)
Stock Gain / Loss
Million Baht
(14,439)
2,624
(17,063)
Net Realizable Value (NRV)
Million Baht
(2,451)
0
(2,451)
Million Baht
12,864
6,692
6,172
Net Profit Earnings per share
Net Profit excluding stock gain / loss and NRV
Remarks: (1) Revised the 2013 financial statements, since January 1, 2014 onward, Thaioil Group adopted Thai Financial Reporting Interpretations Committee 4 (TFRIC 4) on determining whether an arrangement contains a lease (2) GIM is the integrated gross margin among Thai oil Plc. (TOP), Thai Paraxylene Co., Ltd (TPX) and Thai Lube Base Plc. (TLB)
This year, Thaioil Group focused on operational excellence.
of stock loss, of USD 6.2 per barrel, down by USD 0.6 per
The refinery and the aromatics plant successfully underwent
barrel. Still, with the steadily weakening oil price in the latter
a planned major turnaround, which lowered the throughput
half of the year—Dubai crude oil price reached its six-year
for the Group by 13,000 barrels per day to 281,000 barrels
low in December 2014—Thaioil realized stock loss of
per day. Product prices dropped from those of last year
USD 4.3 per barrel or Baht 14,439 million. An adjustment
with the sluggish world economy, which lowered the crude
of inventory write-down to NRV of Baht 2,451 million and
oil demand, while supply worries lingered about market
a GIM of USD 1.9 per barrel, inclusive of the Group’s stock
gluts. As a result, sales revenue registered only Baht
loss. However the Group’s efficient price risk management
390,090 million, a 6% drop from last year. In addition,
it resulted in a net derivative gain on commodities hedging
aromatics markets bore the brunt of the series of newcomers,
of Baht 2,218 million, a rise of Baht 926 million. Therefore,
whereas the demand posed by downstream producers
Thaioil Group reported EBITDA fell by Baht 19,686 million
dipped with the sluggish Chinese economy, causing a narrower
to Baht 2,651 million. The Group’s financing cost amounted
spread between paraxylene and ULG95. Meanwhile, the
to Baht 3,966 million, a net foreign exchange gain of Baht
lube base oil markets continued to be squeezed by rising
966 million and a reversal of income tax expense of Baht
supply, thus spawning price competition between lube base
920 Million. In 2014, Thaioil Group posted net loss of Baht
oil Group I and Group II ever since mid-year. All these have
4,026 million, or Baht 1.97 in net loss per share.
resulted in a GIM of total production of the Group, exclusive
147
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
Man age m e n t ’s Di sc u ssi on and Analys is of Fi n an c i al Posi t i on an d Op e rating Res ults
Results by Company
of lube base oil amid the sharp rise in supply of Group II lube
Thai Oil Plc. (TOP) posted a capacity utilization rate of 98%
base oil, resulting in fierce competition with Group I lube
with a throughput of 269,000 barrels per day. The 46-day
base oil. This squeezed the P2F (Product to Feed) margin
planned major turnaround involved CDU-3, CCR-1, and
by USD 32 per ton to USD 112 per ton, hence an EBITDA
other minor units. Meanwhile, the prices of petroleum products
of Baht 1,757 million, a drop of Baht 582 million. With the
were weakening from those of last year, resulting in a sales
deduction of operating expenses and income tax expenses,
drop of Baht 19,450 million to Baht 389,779 million, along
this year saw TLB net a profit of Baht 1,112 million, a drop
with a market GRM, exclusive of stock loss of USD 5.7 per barrel,
of Baht 556 million from last year.
a rise of USD 1.4 per barrel. Still, amid the plummeting oil price toward the year-end, TOP realized a stock loss of USD 4.5 per barrel, thus a negative EBITDA of Baht 721 million. TOP posted a net derivative gain on commodities h e d g i n g o f B a h t 2 , 2 1 8 m i l l i o n , a f o re i g n e x c h a n g e gain of Baht 873 million, and a profit from reversal of impairment loss on land value of Baht 386 million. In short, TOP netted a drop in profit before dividend of Baht 8,042 million to a net loss before dividend received of Baht 5,030 million this year (with dividend, the net profit amounted to Baht 934 million).
Thaioil Power Co., Ltd (TP) posted a capacity utilization rate of 89% with Baht 5,219 million in sales revenue (a rise of Baht 87 million), while its EBITDA gained by Baht 55 million to Baht 696 million. TP’s net profit, exclusive of its profit share from the investment in GPSC of Baht 368 million, rose by only Baht 11 million from last year because of TP’s higher financing cost of Baht 43 million. This year, Thaioil Group recognized, without non – controlling interest, share of profit from investment in GPSC of Baht 591 million, some Baht 123 million higher than last year.
Thai Paraxylene Co., Ltd (TPX) posted a capacity utilization
Effective from January 1 this year, Thaioil Group has adopted
rate of 82%, with Baht 56,711 million in sales revenue, a drop
Thai Finance Reporting Interpretations Committee 4 (TFRIC 4),
of Baht 7,808 million from last year. Accounting for this
the latest financial reporting standard, on assessing whether
drop are the narrowing price spreads between aromatics
a given agreement consists of lease agreements with
and ULG95 due to the supply gluts at new plants, coupled
retroactive effect. In short, the Group’s previous profit report
with the sluggish demand in line with the Chinese economy,
of Baht 450 million from its sale of investment capital only
resulting in a P2F (product to feed) margin drop of USD 101
for the Group companies’ portion will now be reported as
per ton. This pushed loss on EBITDA of Baht 211 million and
a loss from such sale of Baht 749 million.
posted net loss of Baht 1,309 million. LABIX, a 75%-owned by TPX, was under construction. This year, the new company posted Baht 33 million in operating expenses and a foreign exchange loss of Baht 85 million and a net finance cost of Baht 92 million. Therefore, this year LABIX experienced a net loss of Baht 211 million. Combined with its subsidiary LABIX, the aromatics business group then posted a negative EBITDA of Baht 244 million and a net loss of Baht 1,467 million.
Thaioil Solvent Co., Ltd (Thaioil Solvent) managed a solvent output rate of 91% this year, with calculation beginning from its new installed capacity of 141,000 tons per year from July 21 this year, down from 130% last year, which was based on the former capacity of 76,000 tons per year. It grossed Baht 9,822 million in sales revenue, rising by Baht 41 million from last year with the rising average solvent sales prices per unit from last year. Still, based on the lower gross profit
Thai Lube Base Plc. (TLB) posted a capacity utilization rate
this year and the recorded inventory write-down to net
of 92%, grossed Baht 26,560 million in sales revenue, a fall
realizable value (NRV) of Baht 22 million in the business
of Baht 394 million from last year due to the large price drops
unit’s EBITDA amounted to Baht 406 million, which was
148
THAI OIL PUBLIC COMPANY LIMITED
M a na g ement ’s D i s cus s io n a n d A n a ly s is o f Fin a nci a l P o s i t i o n a nd O p e r a tin g R e s u lts
ANNUAL REPORT 2014
Baht 94 million lower this year. Coupled with the Baht
Thaioil Ethanol Co., Ltd (TET) realized gross sales revenue
24 million rise in depreciation and the mild rise in the financing
of Baht 1,703 million, a rise of Baht 198 million from last
cost, whereas income tax expenses fell by Baht 33 million,
year in line with the rising sales of ethanol, stemming from
the solvent business netted a profit of Baht 153 million,
the expansion of service stations and the growing number
a Baht 79 million decline from last year.
of new-model cars that run on E20 and E85, which in turn increased the domestic gasohol demand from that of last
Thaioil Marine Co., Ltd (TM) posted a fleet utilization rate of
year. Yet, with the diminishing gross margin, TET posted
92% this year, earning Baht 1,199 million in service revenue,
Baht 292 million in EBITDA, a drop of Baht 56 million from
a drop of Baht 32 million with the smaller fleet. As a result,
last year. In addition, TET experienced a share of the loss
its EBITDA dropped by Baht 73 million. In addition, TM
from its investment in both associates, totaling Baht 4 million
realized a share of the loss from investment in an associate
this year. This compares with the profit share from investment
of Baht 28 million, primarily because of VLCC dry docking
of Baht 32 million last year. Once the financing cost of Baht
this year. With the financing cost, income tax expenses, and
61 million was deducted, TET showed a net profit of Baht
depreciation deducted, TM netted a profit of Baht 98 million,
57 million, which equaled a Baht 57 million reduction from
a drop of Baht 20 million from last year.
last year.
Analysis of consolidated financial position Financial Position (Million Baht)
Dec. 31, 2014
Dec. 31, 2013 (Restated)
+/-
Total Assets
192,802
208,662
(15,860)
Total Liabilities
105,763
113,681
(7,918)
87,039
94,981
(7,942)
Total Equity
Total Assets
million from last year, largely as a result of trade accounts
As of year-end 2014, the Company and subsidiaries
payable and income tax payable reduction of Baht 13,743
commanded Baht 192,802 million in total assets, a decline
million and Baht 573 million, respectively. The Group incurred
of Baht 15,860 million from a year earlier, mainly due to a
Baht 5,404 million more in long-term loans and debentures
drop in current assets arising from the Baht 12,606 million
( i n c l u d i n g c u r re n t p o r t i o n ) f o r t h e C o m p a n y i s s u e d
drop in accounts receivable and the Baht 19,975 million
Baht–denominated debentures of Baht 15,000 million for
drop in inventories in line with the weaker crude oil and
capital expenditure or working capital, or both. The Company
petroleum product prices. At the same time, non-current
repaid Baht 12,000 million of debentures due in February
assets surged with the rise in property, plant, and equipment
this year. Also, LABIX borrowed Baht 2,564 million for its plant
by Baht 13,531 million in various projects, and increase in
construction, and Sak Chaisidhi borrowed Baht 178 million
deferred tax assets of Baht 1,306 million.
more for plant expansion.
Total Liabilities
Shareholders’ Equity-net
As of year-end 2014, the Company and subsidiaries posted
As of year-end 2014, the Company and subsidiary posted
Baht 105,763 million in total liabilities, a drop of Baht 7,918
Baht 87,039 million in shareholders’ equity, a drop of Baht
149
THAI OIL PUBLIC COMPANY LIMITED
Man age m e n t ’s Di sc u ssi on and Analys is of Fi n an c i al Posi t i on an d Op e rating Res ults
ANNUAL REPORT 2014
7,942 million from last year, mainly due to its performance this year,
Moreover, there was Baht 9,760 million in subsidiaries’
which incurred a loss of Baht 3,700 million, together with the
investment in LAB production and new SPPs. About Baht
Group’s dividend payment this year of Baht 4,242 million.
1,734 million went into current investment, and Baht 251 million was received for the sale of the Thai Oil 12 vessel.
Analysis of cash flows and financial ratios As of year-end 2014, the Company and subsidiaries held
Cash flow from financing activities amounted to Baht 3,075
Baht 16,237 million in cash and cash equivalents, with a
million, consisting of Baht 3,818 million in cost of funds,
cash flows from operating activities of Baht 24,432 million.
Baht 4,242 million in dividends, and Baht 5,152 million in
Cash flows from investing activities totaled Baht 20,346
net cash received from long-term loans and debentures.
million, mainly due to the purchase of property, plant, and
Due to the cash flows for the above-mentioned activities,
equipment of Baht 18,679 million. Of this amount, Baht
the Company and subsidiaries posted Baht 1,011 million more
8,919 million went into investment in key projects like land
in cash and cash equivalents than the same time last year.
purchasing, emission improvement, CDU-3 Crude Preheat
The Group posted Baht 77 million in foreign exchange loss
Train Improvement, HVU-2 Revamp, and a project on the
at the year-end, which resulted in a total of Baht 16,237
volumetric increase of natural gas fuel for the refinery.
million in total cash and cash equivalents at the year end.
Financial Ratios 2014
2013 (Restated)
+/(-)
Profitability Ratios Quality of earnings ratio
(%)
1
6
(5)
Net profit margin ratio
(%)
(1)
2
(3)
Current ratio
(times)
2.7
2.6
0.1
Quick ratio
(times)
1.8
1.5
0.3
(times)
1.2
1.2
-
Liquidity Ratios
Financial Policy Ratios Total liability / Total equity Long-term loan / Total equity
(times)
0.9
0.8
0.1
Interest coverage ratio
(times)
0.7
5.9
(5.2)
Long-term loan / Total capitalization Net debt to equity ratio Note: Quality of Earnings ratio (%) Net Profit Margin ratio (%) Current ratio (times) Quick ratio (times) Total Liabilities / Total Equity (times) Long-term loan / Total Equity (times) Long-term loan Interest Coverage ratio (times) Long-term loan / Total Capitalization (%) Total Capitalization Net Debt to Equity ratio (times) Net Debt
= = = = = = = = = = = =
(%)
48
44
4
(times)
0.4
0.3
0.1
EBITDA / Sales Revenue Net Profit (Net Loss) / Total Revenue Current Assets / Current Liabilities (Cash and Cash Equivalent + Current investments + Accounts Receivable) / Current Liabilities Total Liabilities / Total Equity Long-Term Loan / Total Equity Long-term borrowings from financial institutions + Debentures (includes current portion) EBITDA / Interest Expenses (Finance costs) Long-Term Loan / Total Capitalization Long-Term Loan + Total Equity Net Debt / Total Equity Interest bearing debt – Cash and cash equivalent - Current investments
150
THAI OIL PUBLIC COMPANY LIMITED
Co nnect ed Tra ns a ct i o n s
26
ANNUAL REPORT 2014
CONNECTED TRANSACTIONS
For the 2014 accounting period, Thaioil or its subsidiaries engaged in significant business transactions with subsidiaries and related partners with common major shareholders or directors, as seen in the notes to its financial statements. Connected transactions were based on market prices or, in the absence of reference market prices, the prices agreed in previous contracts. Below are details of the relationships with these companies.
Company
Current Relationship with Thaioil, as of December 31, 2014
PTT Plc.
>>
Major shareholder, with 49.10% of Thaioil’s shares
Thai Paraxylene Co., Ltd.
>>
Wholly owned by Thaioil
(TPX)
>>
Common director : Mr. Atikom Terbsiri
>>
Thaioil management members on TPX’s Board : Ms. Prisana Praharnkhasuk, Mr. Wisnu Wongsomboon, Mr. Kosol Pimthanothai, and Mr. Pongpun Amornvivat
Thai Lube Base Plc. (TLB)
>>
Wholly owned by Thaioil
>>
Common director : Mr. Atikom Terbsiri
>>
Thaioil management members on TLB’s Board : Mr. Wisnu Wongsomboon, Mr. Abhinant Supatrabutr, Mr. Mitri Reodacha, and Mr. Pongpun Amornvivat
Thaioil Power Co., Ltd. (TP)
>>
26.01% of the shares held by PTT
>>
73.99% of the shares held by Thaioil
>>
Common director : Mr. Atikom Terbsiri
>>
Thaioil management members on TP’s Board : Mr. Somchai Wongwattanasan, Mr. Kosol Pimthanothai, Mr. Mitri Reodacha, and Mr. Bandhit Thamprajamchit
TOP Solvent Co., Ltd. (TS)
>>
Wholly owned by Thaioil Solvent Co., Ltd.
>>
Common director : Mr. Atikom Terbsiri
>>
Thaioil management members on TS’s Board : Mr. Wisnu Wongsomboon, Ms. Pattaralada Sa-Ngasang, and Mr. Teardchat Padungrat
Sak Chaisidhi Co., Ltd.
>>
80.52% of the shares held by TOP Solvent
>>
Thaioil management members on Sak Chaisidhi’s Board : Ms. Prisana Praharnkhasuk, Mr. Wisnu Wongsomboon, Mr. Somchai Wongwattanasan, Mr. Abhinant Supatrabutra, Mr. Mitri Reodacha, and Mr. Teardchat Padungrat
151
THAI OIL PUBLIC COMPANY LIMITED
Con n e c t e d Trans actions
ANNUAL REPORT 2014
Company TOP Solvent (Vietnam) LLC
Current Relationship with Thaioil, as of December 31, 2014 >>
Wholly owned by TOP Solvent
>>
Thaioil management members on TOP Solvent (Vietnam)’s Board : Mr. Wisnu Wongsomboon, Ms. Daranee Mandhatuphalin, and Mr. Teardchat Padungrat
Sapthip Co., Ltd.
>>
50% owned by Thaioil Ethanol
>>
Thaioil management members on Sapthip’s Board : Ms. Prisana Praharnkhasuk, Mr. Wisnu Wongsomboon, and Mr. Mitri Reodacha,
>>
55% owned by Thaioil Marine
>>
Thaioil management member on TOP Maritime’s Board : Mr Nitas Krongvanitchayakul
PTT Energy Solutions Co., Ltd.
>>
40% of the shares held by PTT
(PTTES)
>>
20% owned by Thaiol
>>
Thaioil management member on PTTES’s Board : Mr. Somchai Wongwattanasan
>>
36% of the shares held by PTT
IRPC Plc.
>>
38.51% of the shares held by PTT
Bangchak Petroleum Plc.
>>
27.22% of the shares held by PTT
PTT Global Chemical Plc.
>>
48.89% of the shares held by PTT
>>
Wholly owned by PTT
>>
65.29% of the shares held by PTT
TOP Maritime Service Co., Ltd.
Star Petroleum Refining Co., Ltd.
(PTTGC) PTT International Trading Pte. Ltd. PTT Exploration and Production Plc. (PTTEP) PTT Phenol Co., Ltd.
Common director : Mr. Nattachat Charuchinda >>
Wholly owned by PTT Global Chemical Plc.
152
THAI OIL PUBLIC COMPANY LIMITED
Co nnect ed Tra ns a ct i o n s
ANNUAL REPORT 2014
Connected transactions between Thaioil and/or subsidiaries with major shareholders Connected transactions between Thaioil and PTT Company
Transaction
Value in 2014 (Million Baht)
PTT Plc.
>>
Revenue from the sale of oil products : Thaioil entered into a Product
167,635
Offtake and Crude Supply Agreement (POCSA) with PTT. Both parties agreed on the sales and purchases of refined products at market prices and to follow the procedures to reach an agreed volume as well as other terms and conditions stipulated in the contract. >>
Expenses on the purchases of oil and natural gas products : Thaioil
147,574
entered into a POCSA with PTT. Both parties agreed on the sale and purchase of refined products at market prices and to follow the procedures to reach an agreed volume as well as other terms and conditions stipulated in the contract. >>
Thaioil entered into 10-year (2014 - 2023) and 15-year (2007 - 2022) contracts with PTT for the supply of natural gas to feed the refinery at an agreed volume based on market prices.
Connected transactions between Thaioil’s subsidiaries and PTT Company
Transaction
Value in 2014 (Million Baht)
Thai Paraxylene Co., Ltd.
>>
(TPX)
Revenue from occasional sales of aromatics to PTT,
357
considered normal business practice. >>
Expenses for occasional purchases of petroleum products,
486
considered normal business practice. Thai Lube Base Plc. (TLB)
>>
Revenue from occasional sales of lube base products to PTT,
4,564
considered normal business practice. >>
TLB entered into a five-year gas supply contract with PTT for an agreed
830
volume based on market prices, considered normal business practice. Thaioil Power Co. Ltd.
>>
(TP) Sapthip Co., Ltd.
TP entered into a 25-year gas sales agreement (1998-2022) with PTT at an
3,325
agreed volume based on market prices, considered normal business practice. >>
Sapthip entered into a 10-year ethanol agreement (2011-2021) with PTT at an agreed volume based on market prices, considered normal business practice.
947
153
THAI OIL PUBLIC COMPANY LIMITED
Con n e c t e d Trans actions
ANNUAL REPORT 2014
Connected transactions between Thaioil and subsidiaries (with less than 100% shareholding) or other related companies Company
Transaction
Value in 2014 (Million Baht)
Thaioil Power Co., Ltd.
>>
(TP)
Thaioil entered into a 24-year contract starting April 1, 1998,
1,031
to provide maintenance and other supporting services as well as supply of feedstock, parts, and reserved fuels to TP. The service charges were based on cost-plus pricing, considered normal business practice. >>
Thaioil entered into a 24-year infrastructure sharing contract starting April 1, 1998. TP agreed to pay for the consumption at 2% of its monthly revenue.
>>
Thaioil entered into a 25-year contract (1998-2022) with TP
2,142
for the supply of electricity and stream at an agreed volume based on market prices. IRPC Plc.
>>
Revenue from occasional sales of petroleum products to IRPC,
616
considered normal business practice. PTT Energy Solutions
>>
Co., Ltd. (PTTES)
Expenses under a five-year contract for PTTES’s technical consultancy
117
services regarding petroleum and petrochemical businesses. Consultancy fee was as stipulated in the contract.
Bangchak Petroleum Plc.
>>
Revenue from occasional sales of petroleum products to BCP,
8,948
considered normal business practice. >>
Thaioil entered into a 15-year contract to provide feedstock-receiving service for BCP using Thaioil’s single buoy mooring system. The service charges were based on market prices, with terms and conditions similar to contracts with other parties.
>>
Expenses on occasional purchases of petroleum products from BCP,
1,657
considered normal business practice. Star Petroleum Refining
>>
Co., Ltd.
Revenue from occasional sales of petroleum products to
1,147
Star Petroleum Refining, considered normal business practice. >>
Expenses on occasional purchases of petroleum products from Star Petroleum Refining, considered normal business practice.
1,106
154
THAI OIL PUBLIC COMPANY LIMITED
Co nnect ed Tra ns a ct i o n s
ANNUAL REPORT 2014
Company
Transaction
Value in 2014 (Million Baht)
PTT International Trading
>>
Pte. Ltd.
Revenue from occasional sales of petroleum products to
2,693
PTT International Trading, considered normal business practice. >>
Expenses on occasional purchases of petroleum products from
120
PTT International Trading, considered normal business practice.
Connected transactions between subsidiaries and related companies Company
Related Company
Transaction
Value in 2014 (Million Baht)
Thaioil Power Co., Ltd.
Thai Paraxylene Co., Ltd.
(TP)
(TPX)
>>
TP entered into a 25-year contract
1,295
to supply TPX with electricity and stream at market prices. The contract will end in 2022.
Thai Lube Base Plc.
>>
(TLB)
TP entered into a 25-year contract
740
to supply TLB with electricity and stream at market prices. The contract will end in 2022.
Thai Lube Base Plc.
IRPC Plc.
>>
(TLB)
740
considered normal business practice. Bangchak Petroleum
>>
Plc. PTT International
IRPC Plc.
Occasional sales of base oil,
349
considered normal business practice. >>
Trading Pte. Ltd. Thai Paraxylene
Occasional purchases of by-products,
Occasional purchases of feedstock,
2,546
considered normal business practice. >>
Co., Ltd. (TPX)
Occasional sales of aromatics,
2,003
considered normal business practice. PTT International Trading Pte. Ltd.
>>
Occasional sales of aromatics, considered normal business practice.
2,400
155
THAI OIL PUBLIC COMPANY LIMITED
Con n e c t e d Trans actions
ANNUAL REPORT 2014
Company
Related Company
Transaction
Value in 2014 (Million Baht)
TOP Solvent Co., Ltd
IRPC Plc.
>>
Occasional purchases of solvents,
1,954
considered normal business practice. PTT Global Chemical
>>
Plc. (PTTGC) PTT Phenol Co., Ltd.
Occasional sales of solvents,
166
considered normal business practice. >>
Occasional purchases of solvents,
141
considered normal business practice. Sak Chaisidhi Co., Ltd.
IRPC Plc.
>>
Sak Chaisidhi engaged in three contracts
590
for the purchases of feedstock from IRPC at an agreed volume based on reference market prices. The one-year contract ends in 2014. PTT Global Chemical
>>
Plc. (PTTGC)
Sak Chaisidhi engaged in a contract
2,249
for the purchase of feedstock from PTT Global Chemical at an agreed volume based on reference market prices. The contract will end upon a written notice from either party.
TOP Solvent (Vietnam)
IRPC Plc.
>>
LLC.
Occasional purchases of solvents,
552
considered normal business practice.
TOP Maritime Service
PTT Exploration and
Co., Ltd.
Production Plc. (PTTEP)
>>
TOP Maritime entered into a three-year contract and a five-year contract with PTTEP for transportation of supplies and personnel with service charges as stipulated in the contracts. The two contracts end in 2016 and 2017 respectively.
107
156
THAI OIL PUBLIC COMPANY LIMITED
Boa rd o f D i rect o rs ’ R e s p o n s ib ility f o r F in a n c ia l R e p o r tin g
27
ANNUAL REPORT 2014
BOARD OF DIRECTORS’ RESPONSIBILITY FOR FINANCIAL REPORTING
The accompanying financial statements of Thai Oil Public
that the financial position, results of operations and cash
Company Limited and the consolidated financial statements
flows present accurately, an effective internal control system
of Thai Oil Public Company Limited and its subsidiaries have
has been established, accounting records have been
been prepared in conformity with the requirements of the
properly and adequately maintained to safeguard assets
Public Company Act B.E. 2535 (1992), the Securities and
and prevent fraud and other irregularities with material
Exchange Act B.E. 2535 (1992), the Announcement of the
implications, suitable accounting policies have been
Department of Business Development dated September 28,
selected in the preparation of the financial statements and
2011 issued in accordance with Section 11, Paragraph 3
consistently applied in accordance with Financial Reporting
of the Accounting Act B.E. 2543 (2000), and the Financial
Standards, and key information has been adequately
Reporting Standards prescribed by the Federation of
disclosed in the notes to the financial statements. The
Accounting Professions.
independent auditor has expressed opinion on the financial statements of Thai Oil Public Company Limited and the
The Board of Directors is responsible for the financial
consolidated financial statements of Thai Oil Public Company
statements which have been prepared to provide assurance
Limited and its subsidiaries in the Auditor’s Report.
Kurujit Kakornthap
Atikom Terbsiri
Chairman of the Board
Chief Executive Officer / President
Thai Oil Public Company Limited
Thai Oil Public Company Limited
157
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
28
INDEPENDENT AUDITOR’S REPORT
To the Shareholders of Thai Oil Public Company Limited I have audited the accompanying consolidated and separate
that are appropriate in the circumstances, but not for the
financial statements of Thai Oil Public Company Limited and
purpose of expressing an opinion on the effectiveness of the
its subsidiaries (the “Group”) and of Thai Oil Public Company
entity’s internal control. An audit also includes evaluating
Limited (the “Company”), respectively, which comprise the
the appropriateness of accounting policies used and the
consolidated and separate statements of financial position
reasonableness of accounting estimates made by management,
as at 31 December 2014, the consolidated and separate
as well as evaluating the overall presentation of the financial
statements of income, comprehensive income, changes in
statements.
equity and cash flows for the year then ended, and notes, comprising a summary of significant accounting policies and other explanatory information. Management’s Responsibility for the Consolidated and Separate Financial Statements Management is responsible for the preparation and fair presentation of these consolidated and separate financial statements in accordance with Thai Financial Reporting Standards, and for such internal control as management d e t e r m i n e s i s n e c e s s a r y t o e n a b l e t h e p re p a r a t i o n o f consolidated and separate financial statements that are free
I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. Opinion In my opinion, the consolidated and separate financial statements present fairly, in all material respects, the financial position of the Group and the Company, respectively, as at 31 December 2014 and their financial performance and cash flows for the year then ended in accordance with Thai Financial Reporting Standards. Emphasis of Matter
from material misstatement, whether due to fraud or error. Without qualifying my opinion, I draw attention to note 3 to Auditor’s Responsibility My responsibility is to express an opinion on these consolidated and separate financial statements based on my audit. I conducted my audit in accordance with Thai Standards on Auditing. Those standards require that I comply with ethical requirements and plan and perform the audit to obtain
the financial statements describing the effect of the Group’s adoption from 1 January 2014 of certain new accounting policies. The corresponding figures presented are based on the audited financial statements as at and for the year ended 31 December 2013 after making the adjustments described in note 3.
re a s o n a b l e a s s u r a n c e a b o u t w h e t h e r t h e c o n s o l i d a t e d and separate financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.
(Winid Silamongkol)
The procedures selected depend on the auditor’s judgment,
Certified Public Accountant
including the assessment of the risks of material misstatement
Registration No. 3378
of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal
KPMG Phoomchai Audit Ltd.
control relevant to the entity’s preparation and fair presentation
Bangkok
of the financial statements in order to design audit procedures
12 February 2015
158
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
STATEMENT OF FINANCIAL POSITION Thai Oil Public Company Limited and its Subsidiaries
(in Baht)
Consolidated financial statements
Assets
Note
31 December 2014
31 December 2013
1 January 2013
(Restated)
(Restated)
Separate financial statements 31 December 2014 2013
Current assets Cash and cash equivalents
7, 20
16,237,064,742
15,302,596,629
10,459,746,357
13,586,762,421
9,074,889,657
Current investments
8, 20
30,245,500,000
28,512,000,000
17,862,427,375
30,000,000,000
28,500,000,000
Trade accounts receivable
6, 9
16,140,531,085
28,746,177,747
27,089,542,903
16,416,897,099
28,289,142,388
Current portion of financial lease receivable Other receivable Short-term loans to related parties Inventories
6, 10 6 6, 11
Prepaid corporate income tax Value added tax receivable Receivable from Oil Fuel Fund Other current asset Non-current asset held for sale Total current assets
490,725,405
-
-
1,555,425,918
1,322,847,554
1,655,525,414
1,488,814,059
1,282,403,394
90,000,000
90,000,000
90,000,000
4,013,000,000
2,923,000,000
28,533,477,165
48,508,807,787
40,004,178,949
24,037,584,154
42,361,363,192
603,627,570
9,014,978
19,965,214
586,215,565
-
1,517,027,817
2,815,542,729
1,468,247,238
426,160,943
2,075,108,135
523,025,041
1,318,657,423
1,732,088,139
523,025,041
1,318,657,423
17,828,345 12
-
95,463,507,683
The accompanying notes are an integral part of these financial statements.
250,280,999 126,875,925,846
-
-
-
-
-
-
100,872,446,994
91,078,459,282
115,824,564,189
159
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
STATEMENT OF FINANCIAL POSITION Thai Oil Public Company Limited and its Subsidiaries
(in Baht)
Consolidated financial statements
Assets
Note
31 December 2014
31 December 2013
1 January 2013
(Restated)
(Restated)
Separate financial statements 31 December 2014 2013
Non-current assets Investments in subsidiaries
13
Investments in associates
14
12,010,688,806
11,299,350,345
945,772,980
14
419,025,830
422,154,069
339,557,501
8
942,588,787
940,260,153
1,001,921,900
-
-
-
14,545,419,002
11,920,419,002
1,260,604,927
1,260,604,927
Investments in jointly-controlled entities Other long-term investments Financial lease receivable Investment properties
-
7,894,561,015
942,588,787 -
940,260,153 -
88,143,439
82,382,568
82,382,568
1,084,976,420
777,696,716
6, 16, 20
78,998,627,130
65,467,628,690
58,759,609,982
41,158,670,025
36,558,279,054
Intangible assets
17
1,951,698,909
1,970,634,442
1,713,297,540
420,360,228
432,423,608
Deferred tax assets
18
1,480,495,132
174,316,076
29,477,674
1,446,643,130
142,535,935
Other non-current assets
19
1,447,266,014
1,429,628,152
1,318,628,510
1,108,961,134
1,106,778,144
97,338,534,047
81,786,354,495
72,085,209,670
61,968,223,653
53,138,997,539
192,802,041,730
208,662,280,341
172,957,656,664 153,046,682,935
168,963,561,728
Property, plant and equipment
Total non-current assets Total assets
15
-
-
The accompanying notes are an integral part of these financial statements.
160
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
STATEMENT OF FINANCIAL POSITION Thai Oil Public Company Limited and its Subsidiaries
(in Baht)
Consolidated financial statements
Liabilities and equity
Note
31 December 2014
31 December 2013
1 January 2013
(Restated)
(Restated)
Separate financial statements 31 December 2014 2013
Current liabilities Short-term borrowings
20
Trade accounts payable Other payable
497,425,000
663,559,344
607,500,000
-
-
6, 21
17,811,088,274
31,554,321,436
26,614,728,223
18,458,980,224
32,138,993,360
6, 22
3,929,537,412
3,298,064,678
2,242,489,559
2,653,583,779
2,853,632,501
6, 20
-
3,760,194,092
5,836,250,522
Short-term borrowings from related parties
-
-
Current portion of long-term borrowings from financial institutions
749,272,200
484,646,300
1,277,572,897
11,588,926,378
12,329,716,612
2,750,000,000
11,588,926,378
12,329,716,612
Excise duty payable
882,683,472
496,947,661
617,591,787
882,683,472
496,947,661
Income tax payable
175,777,454
748,349,343
1,061,369,341
35,634,710,190
49,575,605,374
35,171,251,807
7, 8, 16, 20
6,531,308,933
4,314,378,700
6,375,980,419
Debentures
20
60,733,974,498
57,070,452,017
35,786,183,962
Deferred tax liabilities
18
Employee benefit obligations
23
Current portion of debenture
7, 8, 16, 20 20
Total current liabilities
-
37,344,367,945
-
182,445,481 53,837,986,137
Non-current liabilities Long-term borrowings from financial institutions
Other non-current liabilities Total non-current liabilities Total liabilities
-
-
549,518,282
60,733,974,498 -
57,070,452,017 -
2,783,862,422
2,635,001,299
2,472,747,809
2,585,823,751
2,454,850,874
78,878,059
85,552,880
53,167,300
309,135,524
263,591,066
70,128,023,912
64,105,384,896
45,237,597,772
63,628,933,773
59,788,893,957
105,762,734,102
113,680,990,270
80,408,849,579 100,973,301,718
113,626,880,094
The accompanying notes are an integral part of these financial statements.
161
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
STATEMENT OF FINANCIAL POSITION Thai Oil Public Company Limited and its Subsidiaries
(in Baht)
Consolidated financial statements
Liabilities and equity
Note
31 December 2014
31 December 2013
1 January 2013
(Restated)
(Restated)
Separate financial statements 31 December 2014 2013
Equity Share capital
24
Authorised share capital
20,400,278,730
20,400,278,730
20,400,278,730
20,400,278,730
20,400,278,730
Issued and paid-up share capital
20,400,278,730
20,400,278,730
20,400,278,730
20,400,278,730
20,400,278,730
25
2,456,261,491
2,456,261,491
2,456,261,491
2,456,261,491
2,456,261,491
25
2,040,027,873
2,040,027,873
2,040,027,873
2,040,027,873
2,040,027,873
244,500,000
244,500,000
244,500,000
244,500,000
244,500,000
57,865,280,420
66,088,838,825
62,889,013,516
27,019,170,488
30,286,676,370
(305,010,714)
(302,952,030)
(300,961,134)
(86,857,365)
(91,062,830)
82,701,337,800
90,926,954,889
87,729,120,476
52,073,381,217
55,336,681,634
4,337,969,828
4,054,335,182
4,819,686,609
87,039,307,628
94,981,290,071
92,548,807,085
192,802,041,730
208,662,280,341
Additional paid-in capital Premium on ordinary shares Retained earnings Appropriated Legal reserve Other Unappropriated Other components of equity Equity attributable to owner of the Company Non-controlling interests Total equity Total liabilities and equity
The accompanying notes are an integral part of these financial statements.
-
-
52,073,381,217
55,336,681,634
172,957,656,664 153,046,682,935
168,963,561,728
162
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
STATEMENT OF INCOME Thai Oil Public Company Limited and its Subsidiaries
(in Baht)
Note
Consolidated financial statements
Separate financial statements
For the year ended 31 December
For the year ended 31 December
2014
2013
2014
2013
(Restated)
Revenue from sale of goods and rendering of services
6, 33
390,090,026,361
414,575,049,743
389,779,023,806
409,228,916,094
6, 11
(394,149,820,301)
(397,541,617,883)
(396,303,124,662)
(401,089,756,322)
(4,059,793,940)
17,033,431,860
(6,524,100,856)
8,139,159,772
-
-
5,963,349,892
3,039,021,349
2,218,486,563
1,292,127,100
2,218,486,563
1,292,127,100
995,932,550
(3,111,428,545)
872,666,907
(3,411,994,680)
2,084,565,735
2,073,890,848
3,222,204,711
3,085,563,854
(477,885,846)
(477,276,026)
(345,238,892)
(403,318,666)
Cost of sale of goods and rendering of services Gross profit (loss) Dividend income
6, 13, 14
Net derivative gain on hedging Net foreign exchange gain (loss) Other income Selling expenses Administrative expenses
6, 27 6
(2,163,337,715)
(2,104,837,135)
(2,074,658,675)
(1,891,289,773)
5
-
(897,492,566)
-
-
14
743,635,080
676,154,123
-
-
(658,397,573)
14,484,569,659
3,332,709,650
9,849,268,956
(3,966,025,581)
(3,786,253,098)
(3,745,925,180)
(3,766,202,306)
(4,624,423,154)
10,698,316,561
(413,215,530)
6,083,066,650
920,208,172
(1,160,359,565)
1,346,753,797
(32,186,229)
(3,704,214,982)
9,537,956,996
933,538,267
6,050,880,421
Owners of the Company
(4,025,892,302)
9,316,234,030
933,538,267
6,050,880,421
Non-controlling interests
321,677,320
221,722,966
-
-
(3,704,214,982)
9,537,956,996
933,538,267
6,050,880,421
(1.97)
4.57
0.46
2.97
Loss from investment sold
6, 28
Share of profit of associates and jointly-controlled entities Profit (loss) before finance costs and income tax expense Finance costs
6, 31
Profit (loss) before income tax expense Reversal of income tax (expense)
32
Profit (loss) for the year
Profit (loss) for the year attributable to:
Profit (loss) for the year Basic earnings (loss) per share
34
The accompanying notes are an integral part of these financial statements.
163
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
STATEMENT OF COMPREHENSIVE INCOME Thai Oil Public Company Limited and its Subsidiaries
(in Baht)
Consolidated financial statements
Separate financial statements
For the year ended 31 December
For the year ended 31 December
Note
2014
2013
2014
2013
(Restated)
Profit (loss) for the year
(3,704,214,982)
9,537,956,996
933,538,267
6,050,880,421
4,205,465
(61,044,833)
4,205,465
(61,044,833)
(6,368,581)
58,936,603
-
-
6,773,254
-
-
-
104,432
117,334
-
-
4,714,570
(1,990,896)
4,205,465
(61,044,833)
(3,699,500,412)
9,535,966,100
937,743,732
5,989,835,588
Owners of the Company
(4,024,572,940)
9,314,243,134
937,743,732
5,989,835,588
Non-controlling interests
325,072,528
221,722,966
-
-
(3,699,500,412)
9,535,966,100
937,743,732
5,989,835,588
Other comprehensive income (loss) Net change in fair value of available-for-sale investments Foreign currency translation differences Defined benefit plan actuarial gains
23
Share of other comprehensive income of associate Other comprehensive income (loss) for the year, net of income tax Total comprehensive income (loss) for the year
Total comprehensive income (loss) attributable to:
Total comprehensive income (loss) for the year
The accompanying notes are an integral part of these financial statements.
Note
-
2,040,027,873
-
The accompanying notes are an integral part of these financial statements.
20,400,278,730 2,456,261,491
-
-
-
-
-
-
-
-
2,040,027,873
-
2,040,027,873
reserve
Legal
244,500,000
-
-
-
-
-
-
-
244,500,000
-
244,500,000
Other
66,088,838,825
9,316,234,030
-
9,316,234,030
-
-
-
(6,116,408,721)
62,889,013,516
1,194,167,411
61,694,846,105
Unappropriated
(91,062,830)
(61,044,833)
(61,044,833)
-
-
-
-
-
(30,017,997)
-
(30,017,997)
investments
(84,211,151)
58,936,603
58,936,603
-
-
-
-
-
(143,147,754)
-
(143,147,754)
differences
subsidiary
interests in
-
-
-
-
-
-
-
117,334 (127,795,383)
117,334
-
-
-
-
-
-
- (127,795,383)
-
- (127,795,383)
117,334
associate
income of
ownership
Equity
the Company
owners of
attributable to
NonTotal equity
1,824,984,123
(153,131,305) (6,269,540,026)
4,819,686,609 92,548,807,085
630,816,712
4,188,869,897 90,723,822,962
interests
controlling
90,926,954,889
9,314,243,134
(1,990,896)
9,316,234,030
-
-
9,535,966,100
(1,990,896)
9,537,956,996
1,204,241,250
1,217,460,257
4,054,335,182 94,981,290,071
221,722,966
-
221,722,966
1,204,241,250
1,217,460,257
- (3,255,644,595) (3,255,644,595)
(6,116,408,721)
87,729,120,476
1,194,167,411
86,534,953,065
Deficit from the
Share of other change in the Currency comprehensive
available-for-sale translation
changes in
Fair value
Other comprehensive income (loss)
Other components of equity
Consolidated financial statements
(in Baht)
Fin a nci a l S t a t ement s
Balance at 31 December 2013
-
-
-
-
Total comprehensive income (loss) for the year
-
-
-
-
-
-
-
-
20,400,278,730 2,456,261,491
-
20,400,278,730 2,456,261,491
Comprehensive income (loss) for the year Profit for the year - reststed Other comprehensive income (loss)
Dividend 35 Loss of non-controlling interests with a change in control from disposal of 5 investment in subsidiary Acquisition of subsidiary’s non-controlling interests from 5 investment in associate Acquisition of subsidiary’s non-controlling interests from 5 investment in subsidiary
Balance at 1 January 2013 - restated
Premium on
share capital ordinary shares
paid-up
Issued and
Retained earnings
Thai Oil Public Company Limited and its Subsidiaries
Year ended 31 December 2013 Balance at 1 January 2013 - as reported Impact of change in accounting policy 3
29
STATEMENT OF C HA NGES IN EQUITY
164 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
Note
-
-
-
-
Total comprehensive income (loss) for the year
2,040,027,873
-
-
-
-
2,040,027,873
-
2,040,027,873
reserve
Legal
244,500,000
-
-
-
-
244,500,000
-
244,500,000
Other
57,865,280,420
(4,022,514,256)
3,378,046
(4,025,892,302)
(4,201,044,149)
66,088,838,825
116,874,555
65,971,964,270
Unappropriated
(86,857,365)
4,205,465
4,205,465
-
-
(91,062,830)
-
(91,062,830)
investments
(90,579,732)
(6,368,581)
(6,368,581)
-
-
(84,211,151)
-
(84,211,151)
differences
subsidiary
interests in
-
-
-
-
-
221,766 (127,795,383)
104,432
104,432
-
-
117,334 (127,795,383)
-
117,334 (127,795,383)
associate
income of
ownership
Equity
the Company
owners of
attributable to
82,701,337,800
(4,024,572,940)
1,319,362
(4,025,892,302)
(4,201,044,149)
90,926,954,889
116,874,555
90,810,080,334
Deficit from the
Share of other change in the Currency comprehensive
available-for-sale translation
changes in
Fair value
Other comprehensive income (loss)
Other components of equity
Consolidated financial statements
NonTotal equity
142,887,214
(3,699,500,412)
4,714,570
(3,704,214,982)
4,337,969,828 87,039,307,628
325,072,528
3,395,208
321,677,320
(41,437,882) (4,242,482,031)
4,054,335,182 94,981,290,071
26,012,659
4,028,322,523 94,838,402,857
interests
controlling
(in Baht)
ANNUAL REPORT 2014
The accompanying notes are an integral part of these financial statements.
20,400,278,730 2,456,261,491
-
-
-
Balance at 31 December 2014
-
-
20,400,278,730 2,456,261,491
-
20,400,278,730 2,456,261,491
Dividend 35 Comprehensive income (loss) for the year Profit (loss) for the year Other comprehensive income (loss)
Balance at 1 January 2014 - restated
Premium on
share capital ordinary shares
paid-up
Issued and
Retained earnings
Thai Oil Public Company Limited and its Subsidiaries
Year ended 31 December 2014 Balance at 1 January 2014 as reported Impact of change in accounting policy 3
29
STATEMENT OF C HA NGES IN EQUITY
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
165
20,400,278,730
2,456,261,491
-
-
-
-
2,456,261,491
ordinary shares
2,040,027,873
-
-
-
-
2,040,027,873
reserve
244,500,000
-
-
-
-
244,500,000
Other
Unappropriated
30,286,676,370
6,050,880,421
-
6,050,880,421
(6,116,408,721)
30,352,204,670
(91,062,830)
(61,044,833)
(61,044,833)
-
-
(30,017,997)
investments
55,336,681,634
5,989,835,588
(61,044,833)
6,050,880,421
(6,116,408,721)
55,463,254,767
equity
Total
(in Baht)
Fin a nci a l S t a t ement s
The accompanying notes are an integral part of these financial statements.
Balance at 31 December 2013
-
-
Total comprehensive income (loss) for the year
-
-
Profit for the year
35
20,400,278,730
share capital
Other comprehensive loss
Comprehensive income (loss) for the year
Dividend
Balance at 1 January 2013
Note
changes in Legal
available-for-sale
Premium on
Fair value
of equity
Other components
paid-up
Retained earnings
Separate financial statements
Issued and
Thai Oil Public Company Limited and its Subsidiaries
Year ended 31 December 2013
29
STATEMENT OF C HA NGES IN EQUITY
166 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
20,400,278,730
2,456,261,491
-
-
-
-
2,456,261,491
ordinary shares
2,040,027,873
-
-
-
-
2,040,027,873
reserve
244,500,000
-
-
-
-
244,500,000
Other
Unappropriated
27,019,170,488
933,538,267
-
933,538,267
(4,201,044,149)
30,286,676,370
(86,857,365)
4,205,465
4,205,465
-
-
(91,062,830)
investments
52,073,381,217
937,743,732
4,205,465
933,538,267
(4,201,044,149)
55,336,681,634
equity
Total
(in Baht)
ANNUAL REPORT 2014
The accompanying notes are an integral part of these financial statements.
Balance at 31 December 2014
Total comprehensive income for the year
-
Other comprehensive income
-
20,400,278,730
-
35
share capital
Profit for the year
Comprehensive income (loss) for the year
Dividend
Balance at 1 January 2014
Note
changes in Legal
available-for-sale
Premium on
Fair value
of equity
Other components
paid-up
Retained earnings
Separate financial statements
Issued and
Thai Oil Public Company Limited and its Subsidiaries
Year ended 31 December 2014
29
STATEMENT OF C HA NGES IN EQUITY
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
167
168
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
STATEMENT OF C ASH FLOWS Thai Oil Public Company Limited and its Subsidiaries
(in Baht)
Note
Consolidated financial statements
Separate financial statements
For the year ended 31 December
For the year ended 31 December
2014
2013
2014
2013
(Restated)
Cash flows from operating activities Profit (loss) for the year
(3,704,214,982)
9,537,956,996
933,538,267
6,050,880,421
2,652,358,234
31,941,713
2,451,358,964
-
Adjustments for Allowance for decline in value of inventories adjusted to net realisable value Depreciation and amortisation
30
6,512,315,359
6,032,951,504
4,291,592,005
3,820,395,696
Finance costs
31
3,966,025,581
3,786,253,098
3,745,925,180
3,766,202,306
384,069,720
3,996,183,839
335,113,368
4,048,155,522
(743,635,080)
(676,154,123)
-
-
6, 13, 14
-
-
(5,963,349,892)
(3,039,021,349)
12
-
107,704,767
-
-
28,720,094
18,916,369
31,975,734
19,847,210
(385,519,689)
-
(385,519,689)
-
-
897,492,566
-
209,911
(26,434,287)
(11,184,954)
(135,125,663)
(123,491,753)
(920,208,172)
1,160,359,565
(1,346,753,797)
32,186,229
7,763,476,778
24,882,421,340
3,958,754,477
14,575,364,193
Unrealised loss on foreign exchange Share of gain of associates and jointly-controlled entities Dividend income Impairment loss on asset held for sale
14
Loss on disposal of property, plant and equipment Reversal of impairment loss on property, plant and equipment, and investment property Loss on disposal of investment
15, 16 5
Realisation of deferred land lease and other income Income tax expense
32
The accompanying notes are an integral part of these financial statements.
169
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
STATEMENT OF C ASH FLOWS Thai Oil Public Company Limited and its Subsidiaries
(in Baht)
Note
Consolidated financial statements
Separate financial statements
For the year ended 31 December
For the year ended 31 December
2014
2013
2014
2013
(Restated)
Changes in operating assets and liabilities Trade accounts receivable
12,587,103,194
(2,874,751,673)
11,857,563,256
(2,431,667,590)
(5,129,285,414)
(5,819,532,309)
(2,724,399,420)
(4,451,051,868)
17,322,972,388
(8,706,729,555)
15,872,420,073
(8,721,754,207)
(25,782,719)
(53,100,168)
(1,579,755)
(512,550)
(13,740,226,891)
5,903,546,102
(13,678,312,156)
5,717,302,747
Other payable
194,175,022
(8,480,918)
327,616,466
(24,582,934)
Excise duty payable
385,735,810
(120,644,126)
385,735,810
(120,644,126)
Other non-current liabilities
157,884,849
151,043,602
249,382,956
259,162,175
19,516,053,017
13,353,772,295
16,247,181,707
4,801,615,840
Income tax paid
(1,560,180,669)
(1,677,518,093)
(726,014,444)
(776,315,461)
Income tax and value added tax received
6,476,894,184
4,455,092,661
4,527,047,626
2,746,382,032
24,432,766,532
16,131,346,863
20,048,214,889
6,771,682,411
Other receivable Inventories Other non-current assets Trade accounts payable
Cash generated from operating activities
Net cash from operating activities
The accompanying notes are an integral part of these financial statements.
170
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
STATEMENT OF C ASH FLOWS Thai Oil Public Company Limited and its Subsidiaries
(in Baht)
Note
Consolidated financial statements
Separate financial statements
For the year ended 31 December
For the year ended 31 December
2014
2013
2014
2013
(Restated)
Cash flows from investing activities Dividends received
-
-
5,963,349,892
3,039,021,349
(1,733,500,000)
(11,129,258,636)
(1,500,000,000)
(11,500,000,000)
6
-
-
(2,058,000,000)
(231,500,000)
6
-
-
968,000,000
492,500,000
Cash outflow on investment in subsidiaries
5, 13
-
-
(2,625,000,000)
(875,000,000)
Cash outflow on investment in associate
5, 14
-
(2,375,456,340)
-
(712,636,927)
5, 14
(37,500,000)
(38,045,000)
-
-
1,221,010
407,003
1,221,010
407,003
(53,591,355)
(61,249,195)
(53,591,355)
(61,249,195)
-
26,947,914
-
-
-
-
-
(4,977,142)
(18,679,324,673)
(12,333,930,789)
(8,918,521,084)
(8,521,718,165)
13,419,864
3,836,975
9,506,444
2,550,000
250,849,339
-
-
-
Purchase of intangible assets
(92,325,312)
(396,570,494)
(29,856,102)
(57,240,454)
Currency translation differences
(15,611,689)
60,846,613
-
-
(20,346,362,816)
(26,242,471,949)
(8,242,891,195)
(18,429,843,531)
Purchase of current investments Cash outflow on short-term loans to related parties Cash inflow on short-term loans to related parties
Cash outflow on investment in jointly-controlled entities Sale of other long-term investment Cash outflow on long-term loans to savings co-operative of employees Advance received for asset held for sale Purchase of investment property Purchase of property, plant and equipment Sale of property, plant and equipment Sale of asset held for sale
Net cash used in investing activities
15
The accompanying notes are an integral part of these financial statements.
171
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
STATEMENT OF C ASH FLOWS Thai Oil Public Company Limited and its Subsidiaries
(in Baht)
Note
Consolidated financial statements
Separate financial statements
For the year ended 31 December
For the year ended 31 December
2014
2013
2014
2013
(Restated)
Cash flows from financing activities Finance costs paid
(3,818,037,109)
(3,067,799,060)
(3,599,224,727)
(3,049,693,393)
Dividends paid
(4,242,482,031)
(6,269,540,026)
(4,201,044,149)
(6,116,408,721)
Repayment of short-term borrowings
(771,845,697)
-
-
-
Proceeds from short-term borrowings
605,711,353
56,059,344
-
-
6
-
-
(2,076,056,430)
-
6
-
-
-
816,276,097
Repayment of long-term borrowings from financial institutions
(23,463,018,867)
(15,193,550,000)
(22,787,500,000)
(14,960,750,000)
Proceeds from long-term borrowings from financial institutions
25,944,575,000
13,280,425,000
22,787,500,000
10,515,500,000
Redemption of debenture
(12,329,716,612)
(2,750,000,000)
(12,329,716,612)
(2,750,000,000)
Proceeds from issue of debentures
15,000,000,000
29,356,029,346
15,000,000,000
29,356,029,346
Repayment of short-term borrowings from related parties Proceeds from short-term borrowings from related parties
Proceeds from subsidiaries’s shares from non-controller
-
1,204,241,250
-
-
Net cash from (used in) financing activities
5
(3,074,813,963)
16,615,865,854
(7,206,041,918)
13,810,953,329
Net increase in cash and cash equivalents
1,011,589,753
6,504,740,768
4,599,281,776
2,152,792,209
(77,121,640)
216,833,895
(87,409,012)
183,207,993
-
(1,878,724,391)
-
-
15,302,596,629
10,459,746,357
9,074,889,657
6,738,889,455
16,237,064,742
15,302,596,629
13,586,762,421
9,074,889,657
1,011,497,177
743,289,232
82,650,293
673,574,845
Effect of exchange rate changes on balance held in foreign currencies at end of year Decrease in cash and cash equivalents from the disposal of a subsidiary during the year Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year
7
Non-cash transaction Payable on purchase of property, plant and equipment
The accompanying notes are an integral part of these financial statements.
172
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29 Note
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Contents
Note
Contents
1
General information
21
Trade accounts payable
2
Basis of preparation of the financial statements
22
Other payable
3
Changes in accounting policies
23
Employee benefit obligations
4
Significant accounting policies
24
Share capital
5
Acquisitions of subsidiaries, associate and
25
Additional paid-in capital and reserves
jointly-controlled entities
26
Segment information
Related parties
27
Other income
6 7
Cash and cash equivalents
28
Administrative expenses
8
Other investments
29
Employee benefit expenses
9
Trade accounts receivable
30
Expenses by nature
Other receivable
31
Finance costs
11
Inventories
32
Expense (reversal) of income tax
12
Non-current asset held for sale
33
Promotional privileges
13
Investments in subsidiaries
34
Basic earnings (losses) per share
14
Investments in associates and
35
Dividends
10
jointly-controlled entities
36
Financial instruments
15
Investment properties
37
Commitments with non-related parties
16
Property, plant and equipment
38
Contingent liabilities and contingent assets
17
Intangible assets
39
Insurance policy
18
Deferred tax
40
Event after the reporting period
19
Other non-current assets
41
Thai Financial Reporting Standards (TFRS)
20
Interest-bearing liabilities
not yet adopted
173
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
These notes form an integral part of the financial statements. The financial statements were authorised for issue by the Board of Directors on 12 February 2015.
1
General information
Thai Oil Public Company Limited, the “Company”, is incorporated in Thailand and has its registered offices and refinery plant as follows: Head office
:
Sriracha office and refinery plant
:
555/1 Energy Complex Building A, 11th Floor, Vibhavadi Rangsit Road, Kwang Chatuchak, Khet Chatuchak, Bangkok 10900, Thailand 42/1 Moo 1, Sukhumvit Road Km. 124, Tambol Tungsukla, Amphur Sriracha, Cholburi 20230, Thailand
The Company was listed on the Stock Exchange of Thailand on 26 October 2004. The Company is an entity in the PTT Public Company Limited (“PTT”) group of companies. PTT is incorporated in Thailand and is the major shareholder of the Company and owned 49.1% of the Company’s issued and paid-up share capital as at 31 December 2014 (31 December 2013: 49.1%). The principal businesses of the Company are oil refining and distributions. Details of the Company’s direct and indirect subsidiaries as at 31 December 2014 and 2013 were as follows:
Name of the entity
Type of business
Country of
Ownership
incorporation
interest (%)
2014
2013
Direct subsidiaries Thai Paraxylene Co., Ltd.
Paraxylene manufacturing
Thailand
99.99
99.99
Thai Lube Base Public
Lube base oil refining and distribution
Thailand
99.99
99.99
Company Limited Thaioil Marine Co., Ltd.
Providing marine transportation services for Thailand
99.99
99.99
Thaioil Energy Services Co., Ltd.
Providing of management and general services
Thailand
99.99
99.99
Thaioil Solvent Co., Ltd.
Investment in solvent and chemical businesses
Thailand
99.99
99.99
Thaioil Ethanol Co., Ltd.
Investment in ethanol business and alternative Thailand
99.99
99.99
Thaioil Power Co., Ltd.
Power and steam generation
Thailand
73.99
73.99
TOP SPP Co., Ltd.
Power and steam generation
Thailand
99.99
99.9
petroleum and liquid chemical products
energy products
9
174
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Name of the entity
Type of business
Country of
Ownership
incorporation
interest (%)
2014
2013
Thailand
99.99
99.99
Thailand
80.52
80.52
Indirect subsidiaries TOP Solvent Co., Ltd.
Distribution of solvent and chemical products
Sak Chaisidhi Co., Ltd.
Solvent and chemical products manufacturing and distribution
TOP Solvent (Vietnam) LLC.
Distribution of solvent and chemical products
Vietnam
100.00
100.00
Sapthip Co., Ltd.
Ethanol products manufacturing and distribution
Thailand
50.00
50.0
Singapore
100.00
100.00
Thailand
55.00
55.00
Thailand
75.00
75.00
0
Thaioil Marine International Pte. Ltd. Investment in marine transportation for crude oil and petroleum product business TOP Maritime Service Co., Ltd.
Providing marine transportation services for crew and utilities in Gulf of Thailand
LABIX Co., Ltd.
Linear Alkyl Benzene manufacturing and distribution
2
Basis of preparation of the financial statements
(a)
Statement of compliance
The financial statements issued for Thai reporting purposes are prepared in the Thai language. This English translation of the financial statements has been prepared for the convenience of readers not conversant with the Thai language. The financial statements are prepared in accordance with Thai Financial Reporting Standards (TFRS) and guidelines promulgated by the Federation of Accounting Professions (“FAP”), applicable rules and regulations of the Thai Securities and Exchange Commission. The FAP has issued the following new and revised TFRS relevant to the Group’s operations and effective for annual accounting periods beginning on or after 1 January 2014: TFRS
Topic
TAS 1 (revised 2012)
Presentation of financial statements
TAS 19 (revised 2012)
Employee Benefits
TFRIC 4
Determining whether an Arrangement contains a Lease
175
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
The initial application of these new and revised TFRS has resulted in changes in certain of the Group’s accounting policies. The effects of these changes, where such effects are considered material to the financial statements, are disclosed in note 3. In addition to the above new and revised TFRS, the FAP has issued a number of new and revised TFRS which are effective for annual financial periods beginning on or after 1 January 2015 and have not been adopted in the preparation of these financial statements. Those new and revised TFRS are disclosed in note 41.
(b)
Basis of measurement
The financial statements have been prepared on the historical cost basis except as stated in the accounting policies.
(c)
Functional and presentation currency
The financial statements are prepared and presented in Thai Baht, which is the Company’s functional currency. All financial information presented in Thai Baht has been rounded in the notes to the financial statements to the nearest million unless otherwise stated.
(d)
Use of estimates and judgements
The preparation of financial statements in conformity with TFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. Actual results may differ from estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which estimates are revised and in any future periods affected. Information about significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amounts recognised in the financial statements is included in the following notes to the financial statements: Note 5 to the financial statements
Acquisitions of subsidiaries, associate and jointly- controlled entities
Note 8 to the financial statements
Other investments
Note 17 to the financial statements
Intangible assets
Note 18 to the financial statements
Deferred tax
Note 23 to the financial statements
Employee benefit obligations
Note 36 to the financial statements
Financial instruments
176
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
3
Changes in accounting policies
(a)
Overview
From 1 January 2014, consequent to the adoption of new and revised TFRS as set out in note 2, the Group has changed its accounting policies in the following areas: •
Presentation
•
Accounting for employee benefits
•
Accounting for arrangements containing a lease
Details of these new accounting policies adopted by the Group are included in notes 3(b) to 3(d) below.
(b)
Presentation
From 1 January 2014, the Group has started to present all items of income and expense recognized in a period in two statements: statements of income and statements of comprehensive income as to align with the major shareholder’s accounting policies. Comparative information has been re-presented so that it also is in conformity with the change. Since the change in accounting policy only impacts presentation aspects, there is no impact on reported profit or earnings per share.
(c)
Accounting for employee benefits
Effective from 1 January 2014, the Group will change to immediately recognising an actuarial gains and losses in other comprehensive income, and no longer recording in profit and loss. This change in policy has not had a material impact on the Group.
(d)
Accounting for arrangements containing a lease
From 1 January 2014, the Group has adopted TFRIC 4 - Determining whether an Arrangement contains a Lease. TFRIC 4 addresses arrangements that do not take the legal form of a lease, but convey rights to use items for agreed periods of time in return for a payment or series of payments. TFRIC 4 provides guidance for evaluating whether such arrangements are, or contain, leases should be accounted for under TAS 17 Leases. If an agreement is determined to contain a lease, then TFRIC 4 requires TAS 17 to be applied to classify and account for the lease. Management has reviewed the Group’s arrangements and has determined the impact of TFRIC 4 adoption on assets, liabilities, and retained earnings of the Group as an associate (Global Power Synergy Company Limited) has a power purchase agreement with an entity which determined to be an agreement containing a finance lease. The effects of the change are recognised retrospectively in the financial statements. The impact of the change on the financial statements is as follows:
177
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
(in million Baht)
Consolidated* financial statements as at 1 January 2014
2013
-
8,385
Statements of financial position Increase in finance lease receivable Increase in investment in associates
143
-
Decrease in property, plant and equipment
-
(6,014)
Increase in deferred tax liabilities
-
456
117
1,194
26
631
Increase in unappropriated retained earning Increase in non-controlling interests *
On 10 January 2013, the Group derecognised its investment in IPT and recognised the investment in GPSC as an investment in as sociate accounted for on an equity basis in the consolidated financial statements. Please see note 5 for further explanation. (in million Baht)
Consolidated financial statements For the period ended 31 December 2013
Statements of income Decrease in revenue from sale of goods and rendering services
(24)
Decrease in cost of sale of goods and rendering of services
(14)
Increase in other income Increase in loss on disposal of investment Increase in share of profit of associates and jointly-controlled entities
19 1,466 143
Increase in income tax expense
2
Decrease in profit for the year
(1,316)
Decrease in basic earnings per share (Baht)
(0.52)
178
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29 4
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Significant accounting policies
The accounting policies set out below have been applied consistently to all periods presented in these financial statements except as explained in note 3, which addresses changes in accounting policies.
(a)
Basis of consolidation
The consolidated financial statements relate to the Company and its subsidiaries (together referred to as the “Group�) and the Group’s interests in associates and jointly-controlled entities. Business combinations The Group applies the acquisition method for all business combinations other than those with entities under common control. Goodwill is measured as the fair value of the consideration transferred including the recognized amount of any noncontrolling interest in the acquiree, less the net recognised amount (generally fair value) of the identifiable assets acquired and liabilities assumed, all measured as of the acquisition date. Consideration transferred includes the fair values of the assets transferred, liabilities incurred by the Group to the previous owners of the acquiree, and equity interests issued by the Group. Consideration transferred also includes the fair value of any contingent consideration and share-based payment awards of the acquiree that are replaced mandatorily in the business combination. A contingent liability of the acquiree is assumed in a business combination only if such a liability represents a present obligation and arises from a past event, and its fair value can be measured reliably. The Group measures any non-controlling interest at its proportionate interest in the identifiable net assets of the acquiree. Transaction costs that the Group incurs in connection with a business combination, such as legal fees, and other professional and consulting fees are expensed as incurred. Subsidiaries Subsidiaries are entities controlled by the Group. Control exists when the Group has the power, directly or indirectly, to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. The accounting policies of subsidiaries have been changed where necessary to align them with the policies adopted by the Group. Losses applicable to non-controlling interests in a subsidiary are allocated to non-controlling interest even if doing so causes the non-controlling interest to have a deficit balance.
179
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ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Loss of control Upon the loss of control, the Group derecognises the assets and liabilities of the subsidiary, any non-controlling interests and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised in profit or loss. If the Group retains any interest in the previous subsidiary, then such interest is measured at fair value at the date that control is lost. Subsequently it is accounted for as an equity-accounted investee or as an available-for-sale financial asset depending on the level of influence retained. Associates and jointly-controlled entities Associates are entities in which the Group has significant influence, but not control, over the financial and operating policies. Significant influence is presumed to exist when the Group holds between 20% and 50% of the voting power of another entity. Jointly-controlled entities are those entities over whose activities the Group has joint control, established by contractual agreement and requiring unanimous consent for strategic financial and operating decisions. The consolidated financial statements include the Group’s share of the total recognised gains and losses of associates and jointly-controlled entities on an equity accounted basis, from the date that significant influence or joint control commences until the date that significant influence or joint control ceases. When the Group’s share of losses exceeds its interest in an associate and jointly-controlled entity, the Group’s carrying amount is reduced to nil and recognition of further losses is discontinued except to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate and jointly-controlled entity. Transactions eliminated on consolidation Intra-group balances and transactions, and any unrealised income or expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements. Unrealised gains arising from transactions with associates are eliminated against the investment to the extent of the Group’s interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.
(b)
Foreign currencies
Foreign currency transactions Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated to the functional currency at the exchange rate at the reporting date. Foreign exchange differences arising on translation are recognised in profit or loss.
180
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ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Non-monetary assets and liabilities measured at cost in foreign currencies are translated to the functional currency at the exchange rates at the dates of the transactions. Foreign operations The assets and liabilities of foreign operations are translated to Thai Baht at the exchange rates at the reporting date. Goodwill and fair value adjustments arising on the acquisition of foreign operations are stated at exchange rates at the reporting date. The revenues and expenses of foreign operations are translated to Thai Baht at the average foreign exchange rates ruling during the periods. Foreign exchange differences arising on translation are recognised in other comprehensive income and presented in the foreign currency translation reserve in equity until disposal of the investments.
(c)
Derivative financial instruments
Derivative financial instruments are used to manage exposure to foreign exchange, interest rate and commodity price risks arising from operational, financing and investment activities. Derivative financial instruments are not used for trading purposes. However, derivatives that do not qualify for hedge accounting are accounted for as trading instruments. Hedge of future foreign currency transactions Forward foreign exchange contracts protect the Group from fluctuations in exchange rates by establishing the rates at which foreign currency assets will be realised or foreign currency liabilities will be settled. Forward foreign exchange contracts are recognised in the financial statements on inception. The premium or discount on the establishment of each agreement is amortised over the contract period. Cross currency swap and interest rate swap contracts Cross currency swap and interest rate swap contracts hedging future fluctuations in exchange rates and interest rates. Foreign financial assets and liabilities hedged by cross currency swap contracts are translated into the functional currency at the foreign exchange rates determined in the contracts and revalued at the reporting date at the foreign exchange rate ruling on that date. Foreign exchange differences are recognised in profit or loss. The differences under interest rate swaps are recorded as adjustments to the interest expense relating to the financial obligations in profit or loss.
181
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Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Hedge of crack spread and time spread Differences between the fixed prices of contracts and the settlement prices are recognised in the profit or loss in the period in which the contracts mature.
(d)
Cash and cash equivalents
Cash and cash equivalents in the statements of cash flows comprise cash balances, current and savings accounts, and highly liquid short-term investments. Bank overdrafts that are repayable on demand are a component of financing activities for the purpose of the statement of cash flows.
(e)
Trade and other accounts receivable
Trade and other accounts receivable are stated at their invoice value less allowance for doubtful accounts. The allowance for doubtful accounts is assessed primarily on analysis of payment histories and future expectations of customer payments. Bad debts are written off when incurred.
(f)
Inventories
Inventories are measured at the lower of cost and net realisable value. Cost of inventories is calculated using the weighted average cost principle, and comprises all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. In the case of manufactured inventories and work in progress, cost includes an appropriate share of production overheads based on normal operating capacity. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs to complete and to make the sale.
(g)
Non-current assets held for sale
Non-current assets that are expected to be recovered primarily through sale rather than through continuing use, are classified as held for sale. The assets are measured at the lower of their carrying value and fair value less cost to sell. Impairment losses on initial classification as held for sale and subsequent gains and losses on remeasurement are recognised in profit or loss. Gains are not recognised in excess of any cumulative impairment loss.
182
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Fin a nci a l S t a t ement s
29 (h)
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Investments
Investments in subsidiaries, jointly-controlled entities and associates Investments in subsidiaries, jointly-controlled entities and associates in the separate financial statements of the Company are accounted for using the cost method. Investments in associates and jointly-controlled entities in the consolidated financial statements are accounted for using the equity method. Any changes in the equity interest in subsidiaries of the Group while control is retained are recorded in equity. Investments in other debt and equity securities Debt securities that the Group has the positive intent and ability to hold to maturity are classified as held-to-maturity investments. Held-to-maturity investments are stated at amortised cost, less any impairment losses. The difference between the acquisition cost and redemption value of such debt securities is amortised using the effective interest rate method over the period to maturity. Debt securities and marketable equity securities, other than those securities held for intended to be held to maturity, are classified as available-for-sale investments. Available-for-sale investments are, subsequent to initial recognition, stated at fair value, and changes therein, other than impairment losses and foreign currency differences on available-for-sale monetary items, are recognised directly in equity. The exceptions are impairment losses and foreign exchange gains and losses, which are recognised in the profit or loss. When these investments are derecognised, the cumulative gain or loss previously recognised directly in equity is recognised in profit or loss. Equity securities which are not marketable are stated at cost less any impairment losses. Disposal of investments On disposal of an investment, the difference between net disposal proceeds and the carrying amount together with the associated cumulative gain or loss that was reported in equity is recognised in profit or loss. If the Group disposes of part of its holding of a particular investment, the deemed cost of the part sold is determined using the weighted average method applied to the carrying value of the total holding of the investment.
(i)
Investment properties
Investment properties are properties which are held to earn rental income, for capital appreciation or for both, but not for sale in the ordinary course of business, use in the production or supply of goods or services or for administrative purposes. Investment properties are stated at cost less accumulated depreciation and impairment losses.
183
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Cost includes expenditure that is directly attributable to the acquisition of the investment property. The cost of self-constructed investment property includes the cost of materials and direct labour, and other costs directly attributable to bringing the investment property to a working condition for its intended use and capitalised borrowing costs.
(j)
Property, plant and equipment
The Group’s owned assets Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the assets to a working condition for their intended use, the costs of dismantling and removing the items and restoring the site on which they are located, and capitalised borrowing costs. Cost also may include transfers from other comprehensive income of any gain or loss on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment. When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment. Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment, and are recognised net in profit or loss. Reclassification to investment property When the use of a property changes from owner-occupied to investment property, its carrying amount at the date of reclassification becomes its cost for subsequent accounting. Subsequent costs The cost of replacing a part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group, and its cost can be measured reliably. The carrying amount of the replaced part is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred. Depreciation Depreciation is calculated based on the depreciable amount, which is the cost of an asset, or other amount substituted for cost, less its residual value.
184
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ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Depreciation is charged to the profit or loss on a straight line basis over the estimated useful lives of each component of an item of property, plant and equipment. The estimated useful lives are as follows: Buildings
10 - 25
years
5 - 20
years
20 - 35
years
Lube base oil refinery plants and equipment
16 - 20
years
Paraxylene plants
10 - 25
years
Power plants
20 - 25
years
25
years
3 - 20
years
Oil and liquid chemical tankers and crew boats
10 - 25
years
Furniture, fixtures, office equipment and others
5 - 10
years
5
years
Leasehold improvements Refinery plant and equipment (depreciated over the remaining estimated useful life starting from 1 October 1994)
Transmission facilities Machinery, equipment and plant equipment
Vehicles No depreciation is provided on freehold land and assets under construction.
Depreciation methods, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate.
(k)
Intangible assets
Goodwill Goodwill that arises upon the acquisition of subsidiaries is included in intangible assets. The measurement of goodwill at initial recognition is described in note 4(a). Subsequent to initial recognition, goodwill is measured at cost less accumulated impairment losses. In respect of equity-accounted investees, the carrying amount of goodwill is included in the carrying amount of the investment, and an impairment loss on such an investment is not allocated to any asset, including goodwill, that forms part of the carrying amount of the equity-accounted investee. Customer database Customer database is stated at cost less accumulated impairment losses.
185
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
License fee and computer software License fee and computer software that are acquired by the Group, which have finite useful lives, are stated at cost less accumulated amortisation and accumulated impairment losses. Subsequent expenditure Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognised in profit or loss as incurred. Amortisation Amortisation is calculated over the cost of the asset, or other amount substituted for cost, less its residual value. Amortisation is recognised in profit or loss on a straight-line basis over the estimated useful lives of intangible assets, other than goodwill, from the date that they are available for use. The estimated useful lives are as follows: License fee Computer software
10 - 20
years
5 - 10
years
Amortisation methods, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate.
(l)
Deferred charges
Deferred charges are amortised over the estimated periods to which the benefits relate, which are principally in line with the agreements to which such deferred charges relate.
(m)
Impairment
The carrying amounts of the Group’s assets are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, the assets’ recoverable amounts are estimated. For goodwill and intangible assets that have indefinite useful lives or are not yet available for use, the recoverable amount is estimated each year at the same time. An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. The impairment loss is recognised in profit or loss.
186
THAI OIL PUBLIC COMPANY LIMITED
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29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
When a decline in the fair value of an available-for-sale financial asset has been recognised directly in equity and there is objective evidence that the value of the asset is impaired, the cumulative loss that had been recognised directly in equity is recognised in profit or loss even though the financial asset has not been derecognised. The amount of the cumulative loss that is recognised in profit or loss is the difference between the acquisition cost and current fair value, less any impairment loss on that financial asset previously recognised in profit or loss. Calculation of recoverable amount The recoverable amount of the Group’s investments in held-to-maturity securities and receivables carried at amortised cost is calculated as the present value of estimated future cash flows, discounted at the original effective interest rate. Receivables with a short duration are not discounted. The recoverable amount of available-for-sale assets is calculated by reference to the fair value. The recoverable amount of a non-financial asset is the greater of the asset’s value in use and fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate cash inflows largely independent of those from other assets, the recoverable amount is determined for the cash-generating unit to which the asset belongs. Reversals of impairment An impairment loss in respect of a financial asset is reversed if the subsequent increase in recoverable amount can be related objectively to an event occurring after the impairment loss was recognised. For financial assets carried at amortised cost and available-for-sale financial assets that are debt securities, the reversal is recognised in profit or loss. For available-for-sale financial assets that are equity securities, the reversal is recognised in other comprehensive income. An impairment loss in respect of goodwill is not reversed. Impairment losses recognised in prior periods in respect of other non-financial assets are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.
(n)
Discount on debentures
Discount on debentures, comprising the difference between proceeds from debentures issuance and redemption value on maturity, is recognised in the profit or loss over the period of the borrowings on an effective interest basis.
THAI OIL PUBLIC COMPANY LIMITED
29 (o)
187 Fi n an c i al Statements
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Interest-bearing liabilities
Interest-bearing liabilities are stated at cost.
(p)
Trade and other accounts payable
Trade and other accounts payable are stated at cost.
(q)
Employee benefits
Defined contribution plans A defined contribution plan, provident fund, is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognised as an employee benefit expense in profit or loss in the periods during which services are rendered by employees. Defined benefit plans A defined benefit plan is a post-employment benefit plan other than a defined contribution plan. The Group’s net obligation in respect of defined benefit pension plans is calculated separately for each plan by estimating the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value. Any unrecognised past service costs and the fair value of any plan assets are deducted. The discount rate is the yield at the reporting date on government bonds that have maturity dates approximating the terms of the Group’s obligations and that are denominated in the same currency in which the benefits are expected to be paid. The calculation is performed by a qualified actuary using the projected unit credit method. When the benefits of a plan are improved, the portion of the increased benefit relating to past service by employees is recognised in profit or loss on a straight-line basis over the average period until the benefits become vested. To the extent that the benefits vest immediately, the expense is recognised immediately in profit or loss. The Group recognises all actuarial gains and losses in other comprehensive income. Other long-term employee benefits The Group’s net obligation in respect of long-term employee benefits is the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is the yield at the reporting date on government bonds that have maturity dates approximating the terms of the Group’s obligations. The calculation is performed by a qualified actuary using the projected unit credit method. Any actuarial gains and losses are recognised in profit or loss in the period in which they arise.
188
THAI OIL PUBLIC COMPANY LIMITED
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29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Termination benefits Termination benefits are recognised as an expense when the Group is committed demonstrably, without realistic possibility of withdrawal, to a formal detailed plan to either terminate employment before the normal retirement date, or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. Termination benefits for voluntary redundancies are recognised as an expense if the Group has made an offer of voluntary redundancy, it is probable that the offer will be accepted, and the number of acceptances can be estimated reliably. If benefits are payable more than 12 months after the reporting period, then they are discounted to their present value. Short-term employee benefits Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as an employee benefit expense in profit or loss in the periods during which services are rendered by employees. A liability is recognised for the amount expected to be paid under short-term cash benefit if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee, and the obligation can be estimated reliably.
(r)
Provisions
A provision is recognised when the Group has a present legal or constructive obligation as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.
(s)
Revenue
Revenue excludes value added taxes or other sales taxes and is arrived at after deduction of trade discounts. Sale of goods and services rendered Revenue is recognised in profit or loss when the significant risks and rewards of ownership have been transferred to the buyer. No revenue is recognised if there is continuing management involvement with the goods or there are significant uncertainties regarding recovery of the consideration due, associated costs or the probable return of goods. Service income is recognised as services are provided. Rental income Rental income from assets is recognised in profit or loss on a straight-line basis over the term of the lease.
THAI OIL PUBLIC COMPANY LIMITED
29
189 Fi n an c i al Statements
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Interest and dividend income Interest income is recognised in the profit or loss as it accrues. Dividend income is recognised in the profit or loss on the date the Group’s right to receive payments is established which in the case of quoted securities is usually the ex-dividend date.
(t)
Expenses
Leases payments Payments made under operating leases are recognised in profit or loss on a straight line basis over the term of the lease. Repair and maintenance expenses Expenditure on repair and maintenance is charged to profit or loss in the period in which the expenditure is incurred. Expenditure of a capital nature is added to the cost of the related plant and equipment. Finance costs Finance costs comprise interest expense and similar cost. Borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying asset are recognised in profit or loss for the period in which they are occurred.
(u)
Income tax
Income tax expense on the profit or loss for the year comprises current and deferred tax. Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years. Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of goodwill; the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss; and differences relating to investments in subsidiaries and jointly-controlled entities to the extent that it is probable that they will not reverse in the foreseeable future. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, using tax rates enacted or substantively enacted by the reporting date. The measurement of deferred tax reflects the tax consequences that would follow the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
190
THAI OIL PUBLIC COMPANY LIMITED
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29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
In determining the amount of current and deferred tax, the Group takes into account the impact of uncertain tax positions and whether additional taxes and interest may be due. The Group believes that is accruals for tax liabilities are adequate for all open tax years based on its assessment of many factors, including interpretations of tax law and prior experience. This assessment relies on estimates and assumptions and may involve a series of judgements about future events. New information may become available that causes the Group to change its judgement regarding the adequacy of existing tax liabilities; such changes to tax liabilities will impact tax expense in the period that such a determination is made. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously. A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised. Deferred tax assets are reviewed at each reporting date and reduced to the extent that it is no longer probable that the related tax benefit will be realised.
(v)
Segment Reporting
Segment results that are reported to the Group’s the chief operating decision maker include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
5
Acquisitions of subsidiaries, associate and jointly-controlled entities
Subsidiaries
TOP SPP On 26 December 2013, the Company invested in TOP SPP Co., Ltd.. The Company, in which the Company owned 99.99%, has a share capital of 350 million ordinary shares with a par value of Baht 10 each, totalling Baht 3,500 million. The first call was 25% of par value, amounted to Baht 875 million. Subsequently, on 8 April 2014, the Company fully paid for the remaining paid-up capital in proportion to its shareholding, amounting to Baht 2,625 million. The total investment amounted to Baht 3,500 million.
LABIX On 11 July 2013, a subsidiary (Thai Paraxylene Co., Ltd.) invested in LABIX Co., Ltd. together with Mitsui & Co., Ltd.. The company, in which TPX owned 75%, has a share capital of 465 million ordinary shares with a par value of Baht 10 each, totalling Baht 4,655 million. The first call was 40% of par value, amounted to Baht 1,396 million. Subsequently, on 20 December 2013, a subsidiary fully paid for the remaining paid-up capital in proportion to its shareholding, amounting to Baht 2,095 million. The total investment amounted to Baht 3,491 million.
191
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Associate
GPSC On 10 January 2013, Independent Power (Thailand) Company Limited (“IPT”) and PTT Utility Company Limited (“PTTUT”) formed the new amalgamated company and registered the new company namely Global Power Synergy Company Limited (“GPSC”) with The Ministry of Commerce. Pursuant to the amalgamation, the Group as shareholders of IPT swapped all existing ordinary shares held in IPT for new ordinary shares issued by GPSC, resulting in the Group obtaining ownership interests of (a) directly owned by the Company (11.88%) and (b) indirectly owned via Thaioil Power Co., Ltd. (27.71%). Upon the completion of the share swap, the Group derecognised its investment in IPT and recognised the investment in GPSC as an investment in associate accounted for on an equity basis in the consolidated financial statements. In the separate financial statements, the Company recorded the initial value of investment in GPSC, which is accounted for using the cost method, at the book value of IPT at the amalgamation date. In the consolidated financial statements, the Group recorded the initial value of the investment in GPSC, which is accounted for using the equity method, at the fair value of GPSC shares received at the amalgamation date and consequently recognised the difference between the fair value of GPSC shares received at the amalgamation date and the Group’s interest in IPT on that date as gain on investment disposal in the consolidated statement of income. From 1 January 2014, the Group has adopted TFRIC 4 - Determining whether an Arrangement contains a Lease. The effects of the change are recognised retrospectively in the financial statements as disclosed in note 3(d). The impact of the change on the financial statements as at 31 December 2013 is as follows: (in million Baht)
Consolidated financial statements As previously
Impact of change in
reported
accounting policy
As restated
Statement of income for period ended 31 December 2013 Profit (loss) on disposal of investment
568
(1,466)*
*Attributable to the Group and the non-controlling interest amount to Baht 1,199 million and 267 million, respectively. **Attributable to the Group and the non-controlling interest amount to Baht 749 million and 149 million, respectively.
(898)*
*
192
THAI OIL PUBLIC COMPANY LIMITED
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29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Jointly-controlled entities
TOP-NTL Shipping Trust During 2013, at the TOP-NTL Shipping Trust’s Extraordinary General Meeting of the unitholders, the unitholders passed a resolution to issue additional units on two occasions totalling 950,000 units. The subsidiary (Thaioil Marine Co., Ltd.) fully paid SGD 475,000 or equivalent to Baht 12 million for these additional units on 1 August 2013 and 30 October 2013 in proportion to its unitholding. Subsequently, on 27 June 2014, at the Annual General Meeting of the unitholders, there was a resolution to issue additional units totalling 864,400 units or totalling SGD 432,000 or equivalent to Baht 11.25 million. The subsidiary fully paid for these additional shares in proportion to their shareholding on 9 July 2014.
TOP Nautical Star On 2 August 2013, a subsidiary (Thaioil Marine Co., Ltd. (“TM”)) invested in TOP Nautical Star Co., Ltd. together with Nathalin Co., Ltd. (“Nathalin”) and TOP-NTL Shipping Trust (“TOP-NTL”), owned equally by TM and Nathalin. The shareholding portion of TM, Nathalin and TOP-NTL is 35%, 35% and 30% respectively. The company has a share capital of 1.5 million ordinary shares with a par value of Baht 100 each, totalling Baht 150 million. The first call was 25% of par value. Later, TM and TOP-NTL paid for the additional 25% paid-up capital on 30 October 2013, totalling Baht 26.25 million and Baht 22.50 million respectively. Subsequently, on 9 July 2014, TM and TOP-NTL fully paid the remaining 50% of the registered capital, amounted to Baht 26.25 million and Baht 22.50 million respectively.
6
Related parties
Related parties are those parties linked to the Group as shareholders or by common shareholders or directors. Transactions with related parties are conducted at prices based on market prices or, where no market price exists, at contractually agreed prices. Relationships with related parties that control or jointly control the Group or are being controlled or jointly controlled by the Group or have transactions with the Group are as follows:
Country of Name of entities
incorporation
Nature of relationships
PTT Public Company Limited
Thailand
Major shareholder
Thai Paraxylene Co., Ltd.
Thailand
Subsidiary and/or common directors
Thai Lube Base Public Company Limited
Thailand
Subsidiary and/or common directors
Thaioil Marine Co., Ltd.
Thailand
Subsidiary and/or common directors
193
THAI OIL PUBLIC COMPANY LIMITED
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ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Country of Name of entities
incorporation
Nature of relationships
Thaioil Energy Services Co., Ltd.
Thailand
Subsidiary and/or common directors
Thaioil Solvent Co., Ltd.
Thailand
Subsidiary and/or common directors
Thaioil Ethanol Co., Ltd.
Thailand
Subsidiary and/or common directors
Thaioil Power Co., Ltd.
Thailand
Subsidiary and/or common directors
TOP SPP Co., Ltd.
Thailand
Subsidiary and/or common directors
TOP Solvent Co., Ltd.
Thailand
Indirect subsidiary and/or common directors
Sak Chaisidhi Co., Ltd.
Thailand
Indirect subsidiary and/or the Company’s management as a director
TOP Solvent (Vietnam) LLC.
Vietnam
Indirect subsidiary and/or the Company’s management as a director
Sapthip Co., Ltd.
Thailand
Indirect subsidiary and/or the Company’s management as a director
Thaioil Marine International Pte. Ltd.
Singapore
Indirect subsidiary and/or the Company’s management as a director
TOP Maritime Service Co., Ltd.
Thailand
Indirect subsidiary and/or the Company’s management as a director
LABIX Co., Ltd.
Thailand
TOP-NTL Pte. Ltd.
Singapore
TOP-NTL Shipping Trust
Singapore
TOP Nautical Star Co., Ltd.
Thailand
Indirect subsidiary and/or common directors Jointly-controlled entity of subsidiary Jointly-controlled entity of subsidiary Jointly-controlled entity of subsidiary and/or the Company’s management as a director
TOP-NYK MarineOne Pte. Ltd.
Singapore
Jointly-controlled entity of indirect subsidiary and/or the Company’s management as a director
PTT ICT Solutions Co., Ltd.
Thailand
Associate and/or the Company’s management as a director
PTT Energy Solutions Co., Ltd.
Thailand
Associate and/or the Company’s management as a director
Global Power Synergy Co., Ltd.*
Thailand
Indirect associate and/or common directors
Maesod Clean Energy Co., Ltd.
Thailand
Indirect associate and/or the Company’s management as a director
Ubon Bio Ethanol Co., Ltd.
Thailand
Indirect associate and/or the Company’s management as a director
Thome Ship Management (Thailand) Co., Ltd.
Thailand
Indirect associate and/or the Company’s management as a director
194
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Country of Name of entities PTT International Trading Pte. Ltd.
incorporation
Nature of relationships
Singapore
Subsidiary of major shareholder
Thailand
Subsidiary of major shareholder
Energy Complex Co., Ltd.
Thailand
Subsidiary of major shareholder
Star Petroleum Refining Public
Thailand
Associate of major shareholder
Thailand
Associate of major shareholder
Thailand
Associate of major shareholder
Thailand
Associate of major shareholder
PTT Maintenance and Engineering Co., Ltd. Thailand
Associate of major shareholder
PTT Phenol Co., Ltd.
Thailand
Associate of major shareholder
Thai Petroleum Pipeline Co., Ltd.
Thailand
Related company and/or the Company’s
PTT Exploration and Production Public Company Limited
Company Limited IRPC Public Company Limited Bangchak Petroleum Public Company Limited PTT Global Chemical Public Company Limited
management as a director *
On 10 January 2013, Global Power Synergy Co., Ltd., the amalgamated company resulting from the amalgamation of Independent Power (Thailand) Co., Ltd. and PTT Utility Company Limited.
The pricing policies for particular types of transactions are explained further below:
Transactions
Pricing policies
Revenue from sale of goods and rendering
Market prices or, where no market price exists,
of services, lease income, purchase
at contractually agreed prices
of goods and assets Interest income and expense
Agreed rates stipulated in the agreements
Dividend income
Right to receive dividends
Other income and expenses
Contractually agreed prices
Directors’ remuneration
Amounts approved by the Group’s shareholders
195
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Significant transactions for the years ended 31 December 2014 and 2013 with related parties were as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
173,581
192,982
167,635
186,226
152,296
162,647
147,574
157,284
-
2,380
-
2,380
108
22
108
22
51
39
40
29
-
-
59,115
61,693
-
-
39,378
39,813
-
-
-
4,962
Interest income
-
-
136
122
Dividend income
-
-
5,936
3,024
Land lease income
-
-
61
50
Other income
-
-
1,080
1,022
Interest expense
-
-
89
135
Other expenses
-
-
777
828
Purchase of assets
-
-
-
7
33
-
-
-
1,221
648
1,040
640
Major shareholder Revenue from sale of goods and rendering of services Purchase of crude oil and feedstock Purchase-sale of crude oil and feedstock for legal reserve* Other income Other expenses Subsidiaries Revenue from sale of goods and rendering of services Purchase of crude oil and feedstock Purchase-sale of crude oil and feedstock for legal reserve*
Jointly-controlled entities Other income Other expenses
196
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
(in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
12
11
9
7
962
783
914
736
Interest income
4
4
-
-
Dividend income
-
-
27
15
Land lease income
7
7
7
7
60
63
28
38
Other expenses
235
213
212
182
Purchase of assets
169
99
169
99
18,510
17,509
13,396
12,684
11,701
11,222
2,883
3,241
-
3,873
-
3,873
8
13
8
10
220
151
219
151
59
91
48
51
Associates Revenue from sale of goods and rendering of services Purchase of crude oil and feedstock
Other income
Other related parties Revenue from sale of goods and rendering of services Purchase of crude oil and feedstock Purchase-sale of crude oil and feedstock for legal reserve* Other income Other expenses
Directors’ remuneration
*
Purchase-sale of crude oil and feedstock transactions entered for the purpose of maintaining the legal minimum reserve levels of crude oil inventory are transacted with related parties and have already been reversed in the financial statements for the years ended 31 December 2014 and 2013.
197
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Balances as at 31 December 2014 and 2013 with related parties were as follows:
Trade accounts receivable - related parties (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
6,337
12,436
6,096
11,566
-
-
3,599
5,709
Major shareholder PTT Public Company Limited Subsidiaries Thai Paraxylene Co., Ltd. Thai Lube Base Public Company Limited
-
-
579
573
Thaioil Power Co., Ltd.
-
-
39
53
16
-
-
-
2
-
-
-
5
66
-
-
169
370
165
310
19
19
-
-
75
134
-
-
27
20
-
-
6,650
13,045
10,478
18,211
-
-
-
-
6,650
13,045
10,478
18,211
-
-
-
-
Jointly-controlled entities TOP Nautical Star Co.,Ltd Associates Global Power Synergy Co., Ltd. Other related parties IRPC Public Company Limited Bangchak Petroleum Public Company Limited PTT Exploration and Production Public Company Limited PTT International Trading Pte. Ltd. PTT Global Chemical Public Company Limited
Less allowance for doubtful accounts Net Bad and doubtful debts expense for the year
198
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Other accounts receivable - related parties (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
7
9
7
9
Thai Paraxylene Co., Ltd.
-
-
34
39
Thai Lube Base Public Company Limited
-
-
30
43
Thaioil Marine Co., Ltd.
-
-
2
1
Thaioil Energy Services Co., Ltd.
-
-
2
4
Thaioil Solvent Co., Ltd.
-
-
18
17
Thaioil Ethanol Co., Ltd.
-
-
4
4
Thaioil Power Co., Ltd.
-
-
27
38
TOP SPP Co.,Ltd
-
-
5
-
TOP Solvent Co., Ltd.
-
-
2
2
Sak Chaisidhi Co., Ltd.
-
-
5
-
LABIX Co., Ltd.
-
-
40
24
PTT ICT Solutions Co., Ltd.
8
4
8
4
PTT Energy Solutions Co.,Ltd
1
-
1
-
Maesod Clean Energy Co., Ltd
1
1
-
-
Global Power Synergy Co., Ltd.
6
2
6
2
12
1
-
-
2
2
2
2
37
19
193
189
Major shareholder PTT Public Company Limited Subsidiaries
Associates
Thome Ship Management (Thailand) Co., Ltd. Other related party PTT Maintenance and Engineering Co., Ltd. Total
199
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Short-term loans to related parties (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
Thaioil Solvent Co., Ltd.
-
-
2,498
2,486
Thaioil Ethanol Co., Ltd.
-
-
455
437
TOP SPP Co.,Ltd.
-
-
1,060
-
Maesod Clean Energy Co., Ltd
90
90
-
-
Total
90
90
4,013
2,923
Subsidiaries
Associate
Interest rates during the years of 2014 and 2013 were charged at money market rate (MMR) but not exceeding the average minimum loan rate (MLR) of 5 financial institutions less margin. Movements of short-term loans to related parties during the years ended 31 December 2014 and 2013 were as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
90
90
2,923
3,184
Increase
-
-
2,058
231
Decrease
-
-
(968)
(492)
90
90
4,013
2,923
At 1 January
At 31 December
200
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Trade accounts payable - related parties (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
6,961
15,873
6,612
14,918
Thai Paraxylene Co., Ltd.
-
-
1,953
3,157
Thai Lube Base Public Company Limited
-
-
130
583
Thaioil Marine Co., Ltd.
-
-
12
57
Thaioil Power Co., Ltd.
-
-
171
193
Sak Chaisidhi Co., Ltd.
-
-
6
2
Sapthip Co., Ltd.
-
-
9
10
23
-
-
-
27
49
27
49
PTT ICT Solutions Co., Ltd.
-
6
-
-
Ubon Bio Ethanol Co., Ltd.
87
54
87
54
4
5
-
-
IRPC Public Company Limited
200
411
-
-
PTT Global Chemical Public Company Limited
112
243
-
-
12
12
-
-
7,426
16,653
9,007
19,023
Major shareholder PTT Public Company Limited Subsidiaries
Jointly-controlled entities TOP Nautical Star Co.,Ltd. Associates Maesod Clean Energy Co., Ltd
Global Power Synergy Co., Ltd. Other related parties
PTT Phenol Co., Ltd. Total
201
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Other accounts payable - related parties (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
2
4
-
3
Thai Paraxylene Co., Ltd.
-
-
-
2
Thai Lube Base Public Company Limited
-
-
2
3
Thaioil Marine Co., Ltd.
-
-
13
5
Thaioil Energy Services Co., Ltd.
-
-
44
107
Thaioil Solvent Co., Ltd.
-
-
1
-
PTT ICT Solutions Co., Ltd.
44
63
44
60
PTT Energy Solutions Co.,Ltd
25
-
25
-
Thome Ship Management (Thailand) Co., Ltd.
12
-
-
-
Energy Complex Co., Ltd.
1
1
1
1
IRPC Public Company Limited
8
16
8
16
Thai Petroleum Pipeline Co., Ltd.
4
3
4
3
96
87
142
200
Major shareholder PTT Public Company Limited Subsidiaries
Associate
Other related parties
Total
202
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Short-term borrowings from related parties (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
Thai Paraxylene Co., Ltd.
-
-
178
2,171
Thai Lube Base Public Company Limited
-
-
3,465
3,481
Thaioil Marine Co., Ltd.
-
-
117
184
Total
-
-
3,760
5,836
Subsidiaries
Interest rates during the years of 2014 and 2013 were charged at money market rate (MMR) but not exceeding the average minimum loan rate (MLR) of 5 financial institutions less margin. Movements of short-term borrowings from related parties during the years ended 31 December 2014 and 2013 were as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
At 1 January
-
-
5,836
5,020
Increase
-
-
-
816
Decrease
-
-
2,076
-
At 31 December
-
-
3,760
5,836
THAI OIL PUBLIC COMPANY LIMITED
29
203 Fi n an c i al Statements
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Significant agreements with related parties As at 31 December 2014 the Group had the following significant agreements with related parties.
Raw Materials and Oil-Products Purchases and Sales Agreements The Company has raw materials and oil products purchase and sale agreements with a subsidiary, whereby the purchase and sale volumes and prices of raw materials and oil products are specified in the agreements. These agreements are effective on the agreement date and shall be terminated by either party giving at least 6 months notice in writing to the other party.
Oil-Products Sale and Purchase Agreements The Company has oil products purchase and sale agreements with a subsidiary, whereby the purchase and sale volumes and prices are specified in the agreements. These agreements are effective on the agreement date and shall be terminated if either party does not comply with the terms stipulated in the agreements.
By-Product Sale and Purchase Agreement The Company has a by-product purchase and sale agreement with a subsidiary, whereby the purchase and sale volumes and prices of the by-product are specified in the agreement. The agreement is for a period of 13 years expiring in September 2017, or until the termination by mutual consent.
Technology and Communication Service Agreement The Company has a technology and communication service agreement with an associate, whereby the service fees are specified in the agreement. The agreement is for a period of 4 years 6 months expiring in December 2015 and is renewable for additional periods of 5 years.
Crack Spread Swap Agreements The Company has crack spread swap agreements with a related company (“counterparty�). The Company or the counterparty has commitments to make payments for the differences between the fixed price and floating price for each period. As at 31 December 2014, the Company had oil volume under the agreements with the related company of 0.4 million barrels (2013: 0.3 million barrels).
204
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Product Offtake and Crude Oil Supply Agreement The Company has a product off take and crude oil supply agreement with a related company, whereby (a) the Company will sell and the related company will purchase refined petroleum products produced by the refinery for 49.99% of 270,000 barrels per day; and (b) the related party will supply and the Company will purchase crude oil and/or feedstock for the refinery required to produce 49.99% of 270,000 barrels per day. The credit term for crude oil shall be mutually agreed.
Feedstock Throughput Agreement The Company has a feedstock throughput agreement with a related company to use the Company’s single buoy mooring facility for receiving its feedstock. The agreement is for a period of 15 years expiring in 2023 and the throughput fee is stipulated in the agreement.
Throughput Agreement The Company has a throughput agreement with a related company, whereby the tariff fee is specified in the agreement. The agreement is for a period of 20 years expiring in 2014 or when a target is achieved and is renewable.
Natural Gas Supply Agreements The Company and two subsidiaries have natural gas supply agreements with a related company, whereby the related company agrees to supply the natural gas to the Company and the subsidiaries at quantities and prices as stipulated in the agreements. These agreements are effective for periods of 5 to 25 years expiring during 2016 and 2023.
Cost Reimbursement Agreements A subsidiary and an associate have cost reimbursement agreements with the Company covering the reimbursement of construction costs of natural gas pipeline facilities and the use of the pipeline facilities, raw water pipeline and the use of land for the construction of a transmission line connecting the subsidiary and the associate to the Electricity Generating Authority of Thailand (EGAT). Under the terms of the agreements, the subsidiary and the associate agree to share the cost of investments with the Company on the basis and conditions stipulated in the agreements. These agreements are effective for a period of 25 years, or until the termination of the power purchase agreements entered into by the subsidiary and the associate with EGAT, whichever is sooner.
Power and Steam Purchase Agreements Certain subsidiaries (“sellers”) have power and steam purchase agreements with the Company and two subsidiaries for periods of 20 and 25 years expiring in 2023 and 2027, whereby the sellers will sell power and steam energy to the Company and the subsidiaries at the agreed quantities and prices as stipulated in the agreements.
THAI OIL PUBLIC COMPANY LIMITED
29
205 Fi n an c i al Statements
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Services and Supplies Agreements Certain subsidiaries and an associate have services and supplies agreements with the Company, whereby the Company provides the subsidiaries and the associate for the operating, repair and maintenance, management, controlling and administration, procurement, fuel transmission, waste water treatment and utilities, information technology, financial, accounting and human resource services. The subsidiaries and the associate agree to pay certain fees as stipulated in the agreements. These agreements are for periods of 3 years or 24 years or until the termination of the land lease agreement entered into by a subsidiary with the Company, whichever is sooner or until the termination of the power purchase agreement entered into by the associate with EGAT. A subsidiary has services and supplies agreement with the Company, whereby the subsidiary provides the Company for human resource services, whereby the service fee is specified in the agreement. This agreement is for a period of 2 years expiring in December 2015.
Land Lease Agreements Certain subsidiaries and an associate have land lease agreements with the Company to lease/sublease certain parcels of land ending in September 2022, May 2041, and August 2043 with total annual rental for the year 2014 of Baht 68 million, and the rate will be adjusted every 5 years. The Company has a land lease agreement with a related company to lease certain parcels of land ending in August 2026 with total annual rental for the year 2014 of Baht 2.7 million. If the Company does not giving a cancelable notice within a month before contract end date, the contract shall be renewed for additional 15 years.
Raw Materials and Petrochemical Products Purchase and Sale Agreements A subsidiary has raw materials and petrochemical products purchase and sale agreements with related companies, whereby the purchase and sale volumes and prices of raw materials and petrochemical products are specified in the agreements. These agreements are for periods of 1 year to 15 years expiring during 2015 and 2017.
Technical Service Agreements A subsidiary has technical service agreements with the Company and three subsidiaries to provide a consultancy technical solutions service for energy-related and petrochemical businesses, whereby the service fees are specified in the agreements. These agreements are for a period of at least 3 years and shall be terminated by either party giving at least 30 days notice in writing to the other party.
206
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
An associate has a technical service agreement with the Company to provide a consultancy technical solutions service for energy-related and petrochemical businesses, whereby the service fees are specified in the agreement. This agreement is for a period of 5 years expiring in August 2016 and shall be automatically renewed for another a period of 5 years until either party giving at least 6 months notice in writing to the other party.
Time Charter and Affreightment Agreements A subsidiary has time charter and affreightment agreements with the Company and another subsidiary, whereby the freight rate is specified in the agreements. These agreements are for periods of 1 year expiring during 2015. Two jointly-controlled entities have time charter agreements with the Company, whereby the freight rate is specified in the agreements. These agreements are for periods of 10 years expiring in 2021, 2022 and 2024.
Charter of Crew Boat Agreements An indirect subsidiary has charter of crew boat agreement with a related company, whereby the service fees are specified in the agreements. These agreements are for period of 3 and 5 years expiring in 2016 and 2017 and shall be renewed for periods of 2 years by either party giving at least 3 days before contract end date notice in writing to the other party.
Office Rental Agreements A subsidiary has an office rental agreement with a related company, whereby the rental fees are specified in the agreement. The agreement has no specified expiry date so the compliance with conditions specified in the agreement is ongoing until either party giving at least 30 days written notice of termination to the other party. The Company has office rental and service agreements with a related party, whereby the rental and service fees are specified in the agreements. These agreements are for the periods of 3 years expiring in November 2015 and are renewable for additional periods of 3 years.
Ethanol Products Purchase and Sale Agreements An associate has ethanol products purchase and sale agreements with the Company, whereby the purchase and sale volumes and prices of the ethanol products are specified in the agreements. This agreement expired in December 2013. This agreement shall be automatically renewed for additional period of 1 year until either party giving at least 30 days notice in writing to the other party. A subsidiary has an ethanol products purchase and sale agreement with a related company, whereby the purchase and sale volumes and prices of the ethanol products are specified in the agreement. The agreement is for a period of 10 years expiring in June 2021 and shall be renewed by either party giving at least 6 months before contract end date notice in writing to the other party.
THAI OIL PUBLIC COMPANY LIMITED
29
207 Fi n an c i al Statements
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Service Agreements A subsidiary has service agreements with the Company, whereby the service fees are specified in the agreements. These agreements are for a period of 1 year expiring in December 2015. The Company has a service agreement with a subsidiary, whereby the service fees are specified in the agreement. This agreement is for a period of 2 years and 6 months expiring in December 2015. The Company has a service agreement with a subsidiary, whereby the Company provides the subsidiary for the management, controlling and administration services at the service fee as specified in the agreement. This agreement is for a period of not exceeding 27 months or until the termination of the land lease agreement entered into by the subsidiary with the Company, whichever is sooner.
Ship Management Agreements An indirect associate has ship management agreements with a subsidiary, whereby the service fees are specified in the agreements. These agreements are for a period of at least 1 year and shall be terminated by either party giving 3 months notice in writing to the other party.
Crude Oil Storage Tank Service Agreement A related company has a crude oil storage tank service agreement with the Company, whereby the service fees are specified in the agreement. This agreement is for a period of 3 years expiring in September 2016. The Company has a crude oil storage tank service agreement with a related company, whereby the service fees are specified in the agreement. This agreement is for a period of 1 year expiring in December 2015.
Loan Agreement The Company has uncommitted unsecured short term inter-company borrowing and lending agreements with a related company to manage liquidity. Each of the borrowing credit line and lending credit line is not exceeding Baht 2,000 million, bearing the interest rate reference by BIBOR or LIBOR, plus interest rate margin by taking into account on the short term borrowing interest rate, the return on short term investment and credit rating of the Company and the counterparty. These agreements are for a period of 1 year expiring in December 2015.
208
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29 7
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Cash and cash equivalents (in million Baht)
Cash on hand Cash at banks - savings and current accounts
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
3
2
1
1
12,230
13,801
9,582
7,574
4,004
1,500
4,004
1,500
16,237
15,303
13,587
9,075
Cash at banks - fixed deposits (maturity period less than 3 months from the investment date) Total
The currency denomination of cash and cash equivalents as at 31 December 2014 and 2013 was as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
10,941
9,808
8,878
4,044
5,187
5,478
4,709
5,031
Other
109
17
-
-
Total
16,237
15,303
13,587
9,075
Thai Baht United States Dollars
As at 31 December 2014, the Group’s savings, current and fixed deposits totalling Baht 309 million have been pledged as collateral for credit facilities as described in note 20 to the financial statements (2013: nil).
209
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 8
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Other investments (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
30,246
28,512
30,000
28,500
30,246
28,512
30,000
28,500
Equity securities - available-for-sale securities
163
161
163
161
Other non-marketable securities
779
779
779
779
942
940
942
940
31,188
29,452
30,942
29,440
Current investments Cash at bank - fixed deposits
Other long-term investments
Total
All other investments of the Group as at 31 December 2014 and 2013 were denominated entirely in Thai Baht. Cash at bank - fixed deposits As at 31 December 2014, the Group’s fixed deposits totalling Baht 246 million have been pledged as collateral for credit facilities as described in note 20 to the financial statements (2013: nil). Equity securities - available-for-sale securities In 2007 the Company entered into MFC Energy Open End Fund with certain companies so as to raise funds from financial institution investors who are interested in investing in energy or relating energy business. Later, in May 2014 the Fund was renamed to Core Flexible Fund and changed to its investment policy, which the Fund can invest in assets of other industry groups at register in the Stock Exchange. In consideration thereof, the Company has a commitment to purchase a holding in this Fund, comprising 40 million units at par value of Baht 10, amounting to Baht 400 million. During 2014 and 2013, the Fund redeemed automatically from the Company for 0.19 million units and 0.06 million units or amounting to Baht 1.2 million and Baht 0.4 million, respectively. As at 31 December 2014, the Company held totalling 25.0 million units or totalling Baht 250 million at fair value of Baht 163 million (2013: Baht 161 million).
Co., Ltd.
Thai Petroleum Pipeline
Related party
by pipeline
Oil transportation 9.19
9.19
2013
2014
Business (%)
Ownership interest
Type of
Thai Oil Public Company Limited and its Subsidiaries
Other non-marketable securities
29
8,479
2014
8,479
2013
Paid-up capital 2013
779 779
779 779
(in million Baht)
2014
Cost method
Consolidated/Separate financial statements
NOTES TO TH E FINA NCIAL STATEMENTS
–
-
2014
–
-
2013
Dividend income
210
Fin a nci a l S t a t ement s
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
211
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 9
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Trade accounts receivable (in million Baht)
Related parties
Consolidated
Separate
financial statements
financial statements
Note
2014
2013
2014
2013
6
6,650
13,045
10,478
18,211
9,492
15,702
5,939
10,078
16,142
28,747
16,417
28,289
1
1
-
-
16,141
28,746
16,417
28,289
-
-
-
-
Other parties
Less allowance for doubtful accounts Total
Bad and doubtful debts expenses for the year
Aging analyses for trade accounts receivable are as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
6,641
13,040
10,478
18,211
Less than 3 months
5
5
-
-
3 - 6 months
1
-
-
-
6 - 12 months
3
-
-
-
6,650
13,045
10,478
18,211
-
-
-
-
6,650
13,045
10,478
18,211
Note
Related parties Within credit terms Overdue:
Less allowance for doubtful accounts Net
6
212
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
(in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
9,465
15,682
5,939
10,078
23
13
-
-
3 - 6 months
1
2
-
-
6 - 12 months
1
2
-
-
Over 12 months
2
3
-
-
9,492
15,702
5,939
10,078
1
1
-
-
9,491
15,701
5,939
10,078
16,141
28,746
16,417
28,289
Other parties Within credit terms Overdue: Less than 3 months
Less allowance for doubtful accounts Net Total
The normal credit term granted by the Group ranges from 15 days to 90 days. The currency denomination of trade accounts receivable as at 31 December 2014 and 2013 was as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
11,281
20,843
13,188
23,307
4,659
7,621
3,229
4,982
Other
201
282
-
-
Total
16,141
28,746
16,417
28,289
Thai Baht United States Dollars
213
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 10
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Other receivable (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
Prepaid expenses
616
510
460
363
Other accounts receivable
686
335
805
466
44
42
44
42
Other
209
436
180
411
Total
1,555
1,323
1,489
1,282
Current portion of long-term loans to savings co-operative of employees
11
Inventories (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
Crude oil and feedstock
9,077
12,132
7,465
9,859
Materials, spare parts and supplies
1,161
1,135
927
884
Finished and semi-finished oil products
8,890
14,167
5,997
10,605
12,104
21,120
12,100
21,012
-
2
-
1
31,232
48,556
26,489
42,361
2,699
47
2,451
-
28,533
48,509
24,038
42,361
Goods in transit Crude oil Materials, spare parts and supplies
Less allowance for decline in value of inventories adjusted to net realisable value Net
As at 31 December 2014 the Group and the Company’s inventories as stated above included a legal reserve amounting to Baht 8,438 million and Baht 7,947 million respectively (2013: Baht 15,244 million and Baht 14,548 million respectively).
214
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
(in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2014
2013
2013 (Restated)
Inventories recognised as an expense in ‘cost of sale of goods’ - Cost - Write-down to net realisable value
Net
12
390,157
396,242
393,852
401,090
2,652
32
2,451
-
392,809
396,274
396,303
401,090
Non-current asset held for sale
A non-current asset is presented as an asset held for sale following the commitment of a subsidiary’s management. Effort to sell has commenced in 2013, and a sale transaction occurred in January 2014. An impairment loss of Baht 108 million on the remeasurement of the asset classified as held for sale to the lower of its carrying amount and its fair value less cost to sell has been recognised in administrative expenses (note 28). Details of the asset classified as held for sale as at 31 December were as follows: (in million Baht)
Consolidated financial statements Note
2014
2013
16
-
250
-
250
Asset Property, plant and equipment – Oil and liquid chemical tanke
215
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 13
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Investments in subsidiaries (in million Baht)
Separate financial statements Note
At 1 January
2014
2013
11,920
11,533
Acquisitions
5
2,625
875
Disposal
5
-
(488)
14,545
11,920
At 31 December
Thai Oil Public Company Limited and its Subsidiaries
99.99 99.99 99.99 99.99 99.99 73.99 99.99
Thai Lube Base Public Company Limited
Thaioil Marine Co., Ltd.
Thaioil Energy Services Co., Ltd.
Thaioil Solvent Co., Ltd.
Thaioil Ethanol Co., Ltd.
Thaioil Power Co., Ltd.
TOP SPP Co., Ltd.
(%)
99.99
73.99
99.99
99.99
99.99
99.99
99.99
99.99
2013
14,350
3,500
2,810
1,450
1,250
40
970
1,758
2,572
2014
11,725
875
2,810
1,450
1,250
40
970
1,758
2,572
2013
Paid-up capital 2013
14,545
3,500
3,195
1,450
1,250
40
970
1,979
2,161
11,920
875
3,195
1,450
1,250
40
970
1,979
2,161
(in million Baht)
2014
Cost method
None of the Company’s investment in subsidiaries are publicly listed and consequently do not have published price quotations.
Total
99.99
Thai Paraxylene Co., Ltd.
Subsidiaries
2014
Ownership interest
Separate financial statements
5,936
-
104
-
-
60
48
2,637
3,087
2014
3,024
-
416
-
-
-
49
2,109
450
2013
Dividend income
Investments in subsidiaries as at 31 December 2014 and 2013, and dividend income from those investments for the years then ended were as follows:
29
NOTES TO TH E FINA NCIAL STATEMENTS
216
Fin a nci a l S t a t ement s
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
217
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 14
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Investments in associates and jointly-controlled entities (in million Baht)
Note
Consolidated
Separate
financial statements
financial statements
2014
2014
2013
2013 (Restated)
At 1 January - as reported Impact of change in accounting policy
3
At 1 January - restated
11,579
1,286
1,261
60
143
-
-
-
11,722
1,286
1,261
60
744
676
-
-
38
9,749
-
1,201
(75)
(15)
-
-
1
26
-
-
12,430
11,722
1,261
1,261
Share of net gain of investments - equity method Acquisition of associate and jointly - controlled entities
Dividend income Currency transaction differences At 31 December
5
Thai Oil Public Company Limited and its Subsidiaries
39.59* 30.00 21.28
Global Power Synergy Co., Ltd.
Maesod Clean Energy Co., Ltd.
Ubon Bio Ethanol Co., Ltd.
50.00 35.00 50.00
TOP-NTL Shipping Trust
TOP Nautical Star Co., Ltd.
TOP-NYK MarineOne Pte. Ltd.
50.00
35.00
50.00
50.00
33.33
21.28
30.00
39.59*
20.00
20.00
15,605
650
747 15,702
548
75
26
548
150
48
1
14,955
14,955
1
3
2,740
675
11,237
150
150
3
2,740
675
11,237
150
150
5,239
351
274
53
24
-
4,888
1
769
203
3,855
30
30
2014
2014
5,201
313
274
26
13
-
4,888
1
769
203
3,855
30
30
12,430
420
366
28
21
5
12,010
5
768
49
10,961
43
184
11,722
422
392
16
11
3
11,300
7
763
58
10,283
37
152
(Restated)
2013
Equity method
(in million Baht)
2013
Cost method
75
16
16
-
-
-
59
-
-
-
45
2
12
2014
15
-
-
-
-
-
15
-
-
-
-
-
15
2013
Dividend income
Fin a nci a l S t a t ement s
Total
50.00
TOP-NTL Pte. Ltd.
Jointly-controlled entities
(Thailand) Co., Ltd. 33.33
20.00
PTT Energy Solutions Co., Ltd.
Thome Ship Management
20.00
(%)
2013
2014
2014
2013
Paid-up capital
Consolidated financial statements Ownership interest
PTT ICT Solutions Co., Ltd.
Associates
follows:
Investments in associates and jointly-controlled entities as at 31 December 2014 and 2013, and dividend income for the years then ended were as
29
NOTES TO TH E FINA NCIAL STATEMENTS
218 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
20.00 11.88*
PTT Energy Solutions Co., Ltd.
Global Power Synergy Co., Ltd.
(%)
11.88*
20.00
20.00
2013
11,537
11,237
150
150
2014
11,537
11,237
150
150
2013
Paid-up capital
Separate financial statements
2013
1,261
1,201
30
30
1,261
1,201
30
30
(in million Baht)
2014
Cost method
27
13
2
12
2014
15
-
-
15
2013
Dividend income
None of the group’s investment in associates and jointly-controlled entries are publicly listed and consequently do not have published price quotations.
* The Company and a subsidiary (Thaioil Power Co., Ltd.) hold a 11.88% and 27.71% interest in Global Power Synergy Co., Ltd. respectively.
Total
20.00
2014
Ownership interest
Thai Oil Public Company Limited and its Subsidiaries
PTT ICT Solutions Co., Ltd.
29
NOTES TO TH E FINA NCIAL STATEMENTS
THAI OIL PUBLIC COMPANY LIMITED
ANNUAL REPORT 2014
Fi n an c i al Statements
219
220
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
As at 31 December 2014 and 2013, the financial information on associates and jointly-controlled entities which have been accounted for using the equity method and not adjusted for the percentage ownership held by the Group are as follows:
Ownership
Total
Total
Total
Profit
interest
assets
liabilities
revenues
(loss)
(%)
(in million Baht)
2014 Associates PTT ICT Solutions Co., Ltd.
20
2,531
1,598
3,017
226
PTT Energy Solutions Co., Ltd.
20
426
209
569
39
Global Power Synergy Co., Ltd.
39.59*
44,004
16,846
23,502
1,928
Maesod Clean Energy Co., Ltd.
30
2,025
1,862
1,860
(29)
Ubon Bio Ethanol Co., Ltd.
21.28
6,974
4,202
3,485
24
Thome Ship Management (Thailand) Co., Ltd.
33.33
113
99
68
(7)
56,073
24,816
32,501
2,181
Jointly-controlled entities TOP-NTL Pte. Ltd.
50
12
2
15
4
TOP-NTL Shipping Trust
50
133
92
25
(5)
TOP Nautical Star Co., Ltd.
35
890
810
507
(42)
TOP-NYK MarineOne Pte. Ltd.
50
1,948
1,217
330
(21)
59,056
26,937
33,378
2,117
Total
221
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Ownership
Total
Total
Total
Profit
interest
assets
liabilities
revenues
(loss)
(%)
(in million Baht)
2013 Associates PTT ICT Solutions Co., Ltd.
20
1,947
1,190
2,362
214
PTT Energy Solutions Co., Ltd.
20
412
225
452
21
39.59*
50,492
25,494
25,493
1,505
30
2,257
2,065
1,523
(8)
Ubon Bio Ethanol Co., Ltd.
21.28
6,679
3,931
3,579
159
Thome Ship Management (Thailand) Co., Ltd.
33.33
294
273
47
22
62,081
33,178
33,456
1,913
Global Power Synergy Co., Ltd. (Restated) Maesod Clean Energy Co., Ltd.
Jointly-controlled entities TOP-NTL Pte. Ltd.
50
6
1
9
3
TOP-NTL Shipping Trust
50
81
58
17
(4)
TOP Nautical Star Co., Ltd.
35
758
711
15
(28)
TOP-NYK MarineOne Pte. Ltd.
50
2,068
1,284
319
57
64,994
35,232
33,816
1,941
Total
222
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29 15
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Investment properties (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
88
88
844
679
-
-
-
5
-
-
252
160
88
88
1,096
844
(6)
(6)
(66)
(41)
-
-
(11)
(25)
Reversal impairment loss
6
-
66
-
At 31 December
–
(6)
(11)
(66)
Note
Cost At 1 January Addition Reclassification from property, plant and equipment
16
At 31 December
Impairment losses At 1 January Reclassification from property, plant and equipment
16
Net book value At 1 January
82
82
778
638
At 31 December
88
82
1,085
778
Investment properties as at 31 December 2014 and 2013 were valued by a firm of independent professional valuers, at open market values on an existing use basis and income approach. The appraised value of the Group and the Company was Baht 240 million and Baht 1,726 million respectively (2013: Bath 217 million and Baht 1,071 million respectively). Therefore, in 2014, the Group and the Company reversed impairment loss in amount of Baht 6 million and 66 million, respectively.
– as reported
disposal of subsidiary
on consolidation
-
-
-
-
(2)
-
(9)
153
1
1,656
-
1,656
Buildings
-
-
-
(5)
-
-
5
-
5
improvements
-
(40)
-
-
1,079
230
83,914
-
83,914
equipment
plant and
-
-
-
-
42
-
23,003
-
23,003
plants
Paraxylene
-
-
-
-
36
-
5,368
(10,455)
15,823
plants
Power
-
-
-
-
-
-
193
-
193
facilities
mission
Trans-
8
(2)
-
(257)
27
34
3,898
(1,113)
5,011
equipment
and plant
equipment
Machinery,
Consolidated financial statements Oil
-
-
(417)
-
144
14
3,416
-
3,416
crew boats
tankers and
chemical
and liquid
-
(3)
(1)
(22)
12
38
621
-
621
and others
equipment
office
fixtures,
Furniture,
-
(2)
-
(3)
-
-
35
-
35
Vehicles
Total
(11,568)
1
-
-
(23)
(1,416)
12,295
9
(49)
(418)
(319)
-
12,727
6,169 132,026
-
6,169 143,594
in progress
Construction
(in million Baht)
ANNUAL REPORT 2014
Translation differences
Disposals
for sale (note 12)
Transfers to asset held
-
(77)
Transfers, net
Transfers out from
115
3,748
-
3,748
Additions
– restated
At 1 January 2013
accounting policy
Impact of change in
Land
Leasehold
Refinery
Thai Oil Public Company Limited and its Subsidiaries
Property, plant and equipment
At 1 January 2013
Cost
16
29
NOTES TO TH E FINA NCIAL STATEMENTS
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
223
on consolidation
At 31 December 2014
5,950
-
-
Disposals
Translation differences
-
2,164
3,786
Transfers, net
Additions
1 January 2014
Land
1,805
(1)
-
5
2
1,799
Buildings
–
-
-
-
-
–
improvements
Leasehold
96,250
-
(79)
10,967
179
85,183
equipment
plant and
Refinery
Thai Oil Public Company Limited and its Subsidiaries
At 31 December 2013 and
29
23,097
-
-
52
-
23,045
plants
Paraxylene
5,494
-
-
89
1
5,404
plants
Power
193
-
-
-
-
193
facilities
mission
Trans-
4,813
(2)
(27)
1,114
20
3,708
equipment
and plant
equipment
Machinery,
Consolidated financial statements
NOTES TO TH E FINA NCIAL STATEMENTS
Oil
3,847
-
(85)
727
48
3,157
crew boats
tankers and
chemical
and liquid
713
-
(2)
42
28
645
and others
equipment
office
fixtures,
Furniture,
23
-
(8)
-
1
30
Vehicles
Total
(3)
(201)
-
19,107
20,694 162,879
-
-
(12,996)
16,664
17,026 143,976
in progress
Construction
(in million Baht)
224
Fin a nci a l S t a t ement s
THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
-
-
-
-
-
(2)
-
(5)
76
971
-
971
Buildings
-
-
-
(3)
-
3
-
3
improvements
-
(18)
-
-
3,609
57,595
-
57,595
equipment
plant and
-
-
-
-
1,130
7,785
-
7,785
plants
Paraxylene
-
-
-
-
215
3,167
(5,012)
8,179
plants
Power
-
-
-
-
7
126
-
126
facilities
mission
Trans-
2
(2)
-
(146)
231
2,106
(452)
2,558
equipment
and plant
equipment
Machinery,
Consolidated financial statements Oil
-
-
(60)
-
170
622
-
622
crew boats
tankers and
chemical
and liquid
-
(3)
-
(20)
61
475
-
475
and others
equipment
office
fixtures,
Furniture,
-
(2)
-
(2)
4
23
-
23
Vehicles
-
-
-
-
-
-
-
-
in progress
Construction
2
(27)
(60)
(176)
5,503
72,873
(5,464)
78,337
Total
(in million Baht)
ANNUAL REPORT 2014
on consolidation
Translation differences
Disposals
for sale (note 12)
Transfers to asset held
of subsidiary
-
-
-
-
Land
Leasehold
Refinery
Thai Oil Public Company Limited and its Subsidiaries
Transfers out from disposal
for the year
Depreciation charge
– restated
At 1 January 2013
accounting policy
Impact of change in
– as reported
1 January 2013
Depreciation
29
NOTES TO TH E FINA NCIAL STATEMENTS
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
225
At 31 December 2014
- restated
and 1 January 2014
5,939
3,395
3,357
11
(380)
694
759
685
-
-
-
1,111
-
71
1,040
Buildings
-
-
2
-
-
-
-
-
-
-
improvements
31,071
23,997
26,319
-
-
-
65,179
(38)
4,031
61,186
equipment
plant and
13,053
14,130
15,218
-
-
-
10,044
-
1,129
8,915
plants
Paraxylene
1,906
2,022
2,201
-
-
-
3,588
-
206
3,382
plants
Power
54
60
67
-
-
-
139
-
6
133
facilities
mission
Trans-
2,399
1,515
1,790
2
-
2
2,412
(27)
248
2,191
equipment
and plant
equipment
Machinery,
Consolidated financial statements Oil
3,048
2,425
2,794
-
-
-
799
(85)
152
732
crew boats
tankers and
chemical
and liquid
135
132
146
-
-
-
578
-
65
513
and others
equipment
office
fixtures,
Furniture,
Vehicles
5
7
12
-
-
-
18
(7)
2
23
20,694
17,026
6,169
-
-
-
-
-
-
-
in progress
Construction
78,998
65,468
58,760
13
(380)
393
83,868
(157)
5,910
78,115
Total
(in million Baht)
Fin a nci a l S t a t ement s
At 31 December 2013
- restated
At 1 January 2013
Net book value
At 31 December 2014
Reversal of impairment loss
1 January 2014
At 31 December 2013 and
391
-
At 31 December 2014
Impairment losses
-
Disposals
-
1 January 2014
Depreciation charge for the year
Land
Leasehold
Refinery
Thai Oil Public Company Limited and its Subsidiaries
At 31 December 2013 and
29
NOTES TO TH E FINA NCIAL STATEMENTS
226 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
At 31 December 2014 3,831
-
(252)
-
2,152
1,931
-
(160)
824
-
-
3
-
821
-
-
44
-
777
Buildings
and plant
88,248
(78)
-
10,866
179
77,281
(40)
-
1,056
230
76,035
1,071
(25)
-
14
8
1,074
(2)
-
1
14
1,061
equipment
plant and equipment
equipment
Refinery
Machinery,
435
-
-
3
21
411
(2)
-
7
30
376
and others
equipment
fixtures, office
Furniture,
Separate financial statements
4
(3)
-
-
-
7
-
-
-
-
7
Vehicles
8,177
-
-
(10,886)
5,967
13,096
-
-
(1,108)
8,633
5,571
in progress
Construction
102,590
(106)
(252)
-
8,327
94,621
(44)
(160)
-
8,979
85,846
Total
(in million Baht)
ANNUAL REPORT 2014
Disposals
properties (Note 15)
Reclassification to investment
Transfers, net
Additions
1 January 2014
At 31 December 2013 and
Disposals
properties (Note 15)
-
72
2,019
Land
Thai Oil Public Company Limited and its Subsidiaries
Reclassification to investment
Transfers, net
Additions
At 1 January 2013
Cost
29
NOTES TO TH E FINA NCIAL STATEMENTS
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
227
-
Disposals
-
At 31 December 2014
At 31 December 2014
Reversal of impairment loss
properties (Note 15)
-
(320)
(11)
331
(25)
-
-
-
-
-
-
660
-
25
635
-
31
604
Buildings
-
-
-
-
-
-
59,558
(37)
3,641
55,954
(18)
3,222
52,750
-
-
-
-
-
-
845
(25)
50
820
(2)
48
774
equipment
and plant
plant and equipment
equipment
Refinery
Machinery,
-
-
-
-
-
-
364
-
47
317
(2)
46
273
and others
equipment
fixtures, office
Furniture,
Separate financial statements
-
-
-
-
-
-
4
(3)
1
6
-
1
5
Vehicles
-
-
-
-
-
-
-
-
-
-
-
-
-
in progress
Construction
-
(320)
(11)
331
(25)
356
61,431
(65)
3,764
57,732
(22)
3,348
54,406
Total
(in million Baht)
Fin a nci a l S t a t ement s
Reclassification to investment
At 31 December 2013
properties (Note 15)
Reclassification to investment
At 1 January 2013 356
-
Disposals
Impairment losses
-
Depreciation charge for the year
1 January 2014 -
-
Depreciation charge for the year
At 31 December 2013 and
-
Land
Thai Oil Public Company Limited and its Subsidiaries
At 1 January 2013
Depreciation
29
NOTES TO TH E FINA NCIAL STATEMENTS
228 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
3,831
At 31 December 2014 164
186
173
Buildings
and plant
28,690
21,327
23,285
226
254
287
equipment
plant and equipment
equipment
Refinery
Machinery,
71
94
103
and others
equipment
fixtures, office
Furniture,
Separate financial statements
–
1
2
Vehicles
8,177
13,096
5,571
in progress
Construction
41,159
36,558
31,084
Total
(in million Baht)
in 2014, the Group and the Company reversed impairment loss in amount of Baht 380 million and 320 million, respectively.
ANNUAL REPORT 2014
As at 31 December 2014, the Company’s land was valued by a firm of independent professional valuers, at open market values on an existing use basis. Therefore,
million).
statements. The net book value of land, building and machines and crew boats as at 31 December 2014 amounted to Baht 2,095 million (2013: Baht 1,806
Certain subsidiaries mortgaged their land, building and machines and crew boats as collateral for long-term borrowings as described in note 20 to the financial
3,531 million).
million in the consolidated financial statements (2013: Baht 4,999 million) and amounted to Baht 26,514 million in the separate financial statements (2013: Baht
The gross amounts of the Group’s fully depreciated property, plant and equipment that were still in use as at 31 December 2014, amounted to Baht 28,275
1,600
1 January 2014
1,663
Land
Thai Oil Public Company Limited and its Subsidiaries
At 31 December 2013 and
At 1 January 2013
Net book value
29
NOTES TO TH E FINA NCIAL STATEMENTS
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
229
230
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
17 Intangible assets (in million Baht)
Consolidated financial statements Computer
Customer
License fee
software
database
Goodwill
Total
1,420
498
205
614
2,737
290
40
-
-
330
Transfers out from disposal of subsidiary
-
(13)
-
-
(13)
Translation differences on consolidation
-
-
-
33
33
1,710
525
205
647
3,087
69
24
-
-
93
-
-
-
(6)
(6)
1,779
549
205
641
3,174
838
186
-
-
1,024
74
29
-
-
103
-
(10)
-
-
(10)
912
205
-
-
1,117
81
24
-
-
105
993
229
-
-
1,222
At 1 January 2013
582
312
205
614
1,713
At 31 December 2013 and 1 January 2014
798
320
205
647
1,970
At 31 December 2014
786
320
205
641
1,952
Cost At 1 January 2013 Additions
At 31 December 2013 and 1 January 2014 Additions Translation differences on consolidation At 31 December 2014 Accumulated amortisation At 1 January 2013 Amortisation charge for the year Transfers out from disposal of subsidiary At 31 December 2013 and 1 January 2014 Amortisation charge for the year At 31 December 2014 Net book value
231
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
(in million Baht)
Separate financial statements Computer License fee
software
Total
791
351
1,142
18
39
57
809
390
1,199
16
14
30
825
404
1,229
653
69
722
24
21
45
677
90
767
24
18
42
701
108
809
At 1 January 2013
138
282
420
At 31 December 2013 and 1 January 2014
132
300
432
At 31 December 2014
124
296
420
Cost At 1 January 2013 Additions At 31 December 2013 and 1 January 2014 Additions At 31 December 2014 Accumulated amortisation At 1 January 2013 Amortisation charge for the year At 31 December 2013 and 1 January 2014 Amortisation charge for the year At 31 December 2014 Net book value
232
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
18 Deferred tax Deferred tax assets and liabilities as at 31 December 2014 and 2013 were as follows: (in million Baht)
Consolidated financial statements Assets
Total Set off of tax Net deferred tax assets (liabilities)
Liabilities
2014
2013
2014
2013
1,741
594
(261)
(420)
(261)
(420)
261
420
1,480
174
-
-
(in million Baht)
Separate financial statements Assets
Total Set off of tax Net deferred tax assets (liabilities)
Liabilities
2014
2013
2014
2013
1,707
561
(260)
(418)
(260)
(418)
260
418
1,447
143
-
-
233
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Movements in total deferred tax assets and liabilities during the years 2014 and 2013 were as follows: (in million Baht)
Consolidated financial statements (Charged) / credited to: At
Statement
At
1 January
of income
31 December
2014
(Note 32)
Equity
2014
511
45
-
556
79
(77)
-
2
Loss carry forward
-
1,179
-
1,179
Other
4
-
-
4
594
1,147
-
1,741
(416)
160
-
(256)
(4)
(1)
-
(5)
(420)
159
-
(261)
1,306
-
1,480
Deferred tax assets Employee benefits Impairment losses on assets
Total Deferred tax liabilities Depreciation Other Total Net
174
234
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
(in million Baht)
Consolidated financial statements (Charged) / credited to: At
Transfer out
1 January
Statement
from disposal
At
2013
of income
of subsidiary
31 December
(Restated)
(Note 32)
Equity
(Restated)
2013
Employee benefits
465
48
-
(2)
511
Property, plant and equipment
132
(1)
-
(131)
-
79
-
-
-
79
4
-
-
-
4
680
47
-
Depreciation
(577)
161
-
-
(416)
Finance lease receivable
(588)
(1)
-
589
-
(5)
-
-
5
-
(29)
29
-
-
-
(1)
(3)
-
-
(4)
(1,200)
186
-
594
(420)
(520)
233
-
461
174
Deferred tax assets
Impairment losses on assets Other Total
(133)
594
Deferred tax liabilities
Amortisation of transmission facilities transferred to EGAT Other account receivable from winning legal case regarding excise tax assessment Other Total Net
235
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
(in million Baht)
Separate financial statements (Charged) / credited to: At
Statement
At
1 January
of income
31 December
2014
(Note 32)
Equity
2014
482
44
-
526
79
(77)
-
2
-
1,179
-
1,179
561
1,146
-
1,707
(416)
160
-
(256)
(2)
(2)
-
(4)
(418)
158
-
(260)
1,304
-
1,447
Deferred tax assets Employee benefit Impairment losses on assets Loss carry forward Total
Deferred tax liabilities Depreciation Other Total Net
143
236
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
(in million Baht)
Separate financial statements (Charged) / credited to: At
Statement
At
1 January
of income
31 December
2013
(Note 32)
Equity
2013
435
47
-
482
79
-
-
79
514
47
-
561
(577)
161
-
(416)
-
(2)
-
(2)
(577)
159
-
(418)
(63)
206
-
143
Deferred tax assets Employee benefit Impairment losses on assets Total
Deferred tax liabilities Depreciation Other Total Net
Deferred tax asset arising from loss carry forward that has not been recognised in the financial statements as at 31 December 2014 amounted to Baht 422 million (2013: Baht 104 million).
237
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 19
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Other non-current assets (in million Baht)
Long-term loans to savings co-operative of employees
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
651
598
651
598
94
105
76
85
323
365
333
376
38
24
1
2
341
338
48
46
1,447
1,430
1,109
1,107
Deferred natural gas pipeline facilities, raw material pipeline and the use of land, net Deferred land lease arrangement and registration fees, net Other deferred charges, net Refundable deposits and other Total
20
Interest-bearing liabilities (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
- Secured
355
391
-
-
- Unsecured
142
273
-
-
-
-
3,760
5,836
- Secured
245
163
-
-
- Unsecured
505
321
-
-
11,589
12,330
11,589
12,330
12,836
13,478
15,349
18,166
Note
Current Short-term borrowings
Short-term borrowings from related companies
6
Current portion of long-term borrowings from financial institutions
Unsecured debentures
238
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
(in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
- Secured
3,654
911
-
-
- Unsecured
2,877
3,404
-
-
60,734
57,070
60,734
57,070
67,265
61,385
60,734
57,070
80,101
74,863
76,083
75,236
Non-current Long-term borrowings from financial institutions
Unsecured debentures
Total
The periods to maturity of interest-bearing liabilities as at 31 December 2014 and 2013 were as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
Within one year
12,836
13,478
15,349
18,166
After one year but within five years
12,455
17,475
7,697
14,213
After five years
54,810
43,910
53,037
42,857
Total
80,101
74,863
76,083
75,236
239
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Secured interest-bearing liabilities as at 31 December 2014 and 2013 were secured on the following assets: (in million Baht)
Consolidated
Separate
financial statements
financial statements
Note
2014
2013
2014
2013
7
309
-
-
-
8
246
-
-
-
16
2,095
1,806
-
-
2,650
1,806
-
-
Cash at banks - current, savings and fixed deposits Current investments in fixed deposits Land, building and machines, power plant and crew boat - carrying value
Total
As at 31 December 2014 the Group and the Company had unutilised long-term credit facilities totalling Baht 20,216 million and Baht 14,323 million respectively (2013: Baht 23,340 million and Baht 14,290 million respectively). The currency denomination of interest-bearing liabilities as at 31 December 2014 and 2013 was as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
Thai Baht
33,278
23,333
29,260
23,836
United States Dollars
46,823
51,400
46,823
51,400
-
130
-
-
80,101
74,863
76,083
75,236
Other Total
240
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Interest-bearing liabilities as at 31 December 2014 and 2013 were as follows: (in million Baht)
Short-term borrowings Short-term borrowings from related companies
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
497
664
-
-
-
-
3,760
5,836
7,281
4,799
-
-
Debentures
72,323
69,400
72,323
69,400
Total
80,101
74,863
76,083
75,236
Long-term borrowings from financial institutions
Long-term borrowings
Details of principal features of the Group’s long-term borrowings as at 31 December 2014 and 2013 were as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2014
2013
2013
Subsidiaries : 1)
Baht 565 million Loan Facility Agreement at interest MLR less a margin, payable in three-month installments commencing in November 2010
2)
275
325
-
-
1,125
1,275
-
-
195
242
-
-
156
192
-
-
Baht 1,500 million Loan Facility Agreement at interest MLR less a margin, payable in semi-annual installments commencing in September 2012
3)
Baht 324 million Loan Facility Agreement at interest MLR less a margin, payable in monthly installments commencing in April 2012
4)
Baht 228 million Loan Facility Agreement at interest MLR less a margin, payable in monthly installments commencing in January 2013
241
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
(in million Baht)
5)
Consolidated
Separate
financial statements
financial statements
2014
2014
2013
2013
Baht 365 million Loan Facility Agreement at interest MLR less a margin, payable in monthly installments commencing in June 2014
6)
344
242
-
-
365
73
-
-
300
300
-
-
829
1,200
-
-
1,128
950
-
-
1,282
-
-
-
1,282
-
-
-
Baht 365 million Loan Facility Agreement at interest MLR less a margin, payable in monthly installments commencing in October 2014
7)
Baht 300 million Loan Facility Agreement at interest MLR less a margin, payable in semi-annual installments commencing in September 2015
8)
Baht 1,200 million Loan Facility Agreement at interest 6-month FDR plus a margin, payable in semi-annual installment June 2014
9)
Baht 1,800 million Loan Facility Agreement at interest 6-month FDR plus a margin, payable in semi-annual installments commencing in June 2015
10) Baht 3,875 million Loan Facility Agreement at interest THBFIX plus a margin, payable in three-months installments commencing in June 2016 11) Baht 3,875 million Loan Facility Agreement at interest THBFIX plus a margin, payable in three-months installments commencing in June 2016 Total
7,281
4,799
-
-
242
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Debentures On 12 March 2014, the Company issued debentures to institutional investors and/or high net worth investors totalling Baht 15,000 million as detailed below : Tranche No. 1: the 3-year principal amount of Baht 2,000 million, maturing on 12 March 2017 at a coupon rate of 3.41% per annum Tranche No. 2: the 5-year principal amount of Baht 3,000 million, maturing on 12 March 2019 at a coupon rate of 4.13% per annum Tranche No. 3: the 7-year principal amount of Baht 3,000 million, maturing on 12 March 2021 at a coupon rate of 4.61% per annum Tranche No. 4: the 10-year principal amount of Baht 7,000 million, maturing on 12 March 2024 at a coupon rate of 4.84% per annum On 23 January 2013, the Company issued USD 1.0 billion dual-tranche debentures to foreign institutional investors. An aggregate principal amount of USD 500 million of the 10-year tranche due 2023 was issued at a coupon rate of 3.625% per annum and an aggregate principal amount of USD 500 million of the 30-year tranche due 2043 was issued at a coupon rate of 4.875% per annum. Details of the Company’s debentures as at 31 December 2014 and 2013 were as follows: (in million Baht)
Debentures Less discount on debentures Total
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
72,899
69,994
72,899
69,994
(576)
(594)
(576)
(594)
72,323
69,400
72,323
69,400
As at 31 December 2014 the Company has cross currency swap contracts with the local financial institutions for hedging foreign exchange and interest rate exposure of long-term debts for Baht currency totalling Baht 2,500 million (2013: Baht 7,000 million). All counterparties agree to pay the interest and the notional amount according to terms and conditions of the contracts.
243
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 21
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Trade accounts payable (in million Baht)
Consolidated
Separate
financial statements
financial statements
Note
2014
2013
2014
2013
6
7,426
16,653
9,007
19,023
Other parties
10,385
14,901
9,452
13,116
Total
17,811
31,554
18,459
32,139
Related parties
The currency denomination of trade accounts payable as at 31 December 2014 and 2013 was as follows: (in million Baht)
Thai Baht United States Dollars Total
22
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
15,750
18,507
16,525
19,266
2,061
13,047
1,934
12,873
17,811
31,554
18,459
32,139
Other payable (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
Accrued operating expenses
161
240
61
124
Oil Fuel Fund payable
529
219
529
219
Other payables
1,744
1,603
707
1,459
Other
1,496
1,236
1,357
1,052
Total
3,930
3,298
2,654
2,854
244
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29 23
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Employee benefit obligations
Movement in the present value of the defined benefit obligations: (in million Baht)
Defined benefit obligations at 1 January
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
2,635
2,473
2,455
2,305
Benefits paid
(119)
(99)
(117)
(94)
Current service costs and interest
275
271
248
244
Actuarial gain recognised in the year
(7)
-
-
-
Decrease from disposal of subsidiary
-
(10)
-
-
2,784
2,635
2,586
2,455
Defined benefit obligations at 31 December
The expense is recognised in the following line items in the statement of income: (in million Baht)
Cost of sale of goods and rendering of services Selling expenses Administrative expenses Total
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
198
194
176
172
1
1
-
-
76
76
72
72
275
271
248
244
Principal actuarial assumptions as at 31 December 2014 and 2013:
Consolidated financial statements and Separate financial statements % per annum
Discount rate Salary increases rate Employee turnover Mortality rate
Interest rate of long-term Thai Government Bond 4.0-10.0 0.0-1.5
Base on Thailand Mortality Ordinary 2008 (TMO08)
245
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 24
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Share capital 2014 Par value
Number
per share
of shares
(in Baht)
2013 Number Amount
of shares
Amount
(million shares / million Baht)
Authorised At 1 January - Ordinary shares
10
2,040
20,400
2,040
20,400
10
2,040
20,400
2,040
20,400
10
2,040
20,400
2,040
20,400
10
2,040
20,400
2,040
20,400
At 31 December - Ordinary shares
Issued and paid-up At 1 January - Ordinary shares At 31 December - Ordinary shares
25
Additional paid-in capital and reserves
Share premium Section 51 of the Public Companies Act B.E. 2535 requires companies to set aside share subscription monies received in excess of the par value of the shares issued to a reserve account (“share premium”). Share premium is not available for dividend distribution.
Legal reserve Section 116 of the Public Companies Act B.E. 2535 requires that a company shall allocate not less than 5% of its annual net profit, less any accumulated losses brought forward (if any), to a reserve account (“legal reserve”), until this account reaches an amount not less than 10% of the registered authorised capital. The legal reserve is not available for dividend distribution.
246
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS
29
Thai Oil Public Company Limited and its Subsidiaries
Fair value changes The fair value changes account within equity comprises the cumulative net change in the fair value of available-for-sale financial assets until the investments are derecognised or impaired.
Currency translation differences The currency translation differences account within equity comprises all foreign currency differences arising from the translation of the financial statements of foreign operations.
26
Segment information
Segment information is presented in respect of the Group’s business segments. The primary format, business segments, is based on the Group’s management and the internal reporting structure provided to the chief operating decision maker. Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
Reportable segments The Group comprises the following main business segments: Segment 1
:
Oil refinery
Segment 2
:
Lube base oil refinery
Segment 3
:
Petrochemical
Segment 4
:
Power generation
Segment 5
:
Oil and chemical products transportation services
Segment 6
:
Solvent
Segment 7
:
Ethanol
Segment 8
:
Other
2,218
Net derivative gain on hedging
Administrative expenses (2,074)
(345)
3,222
(102)
(163)
138
38
-
-
1,507
(25,053)
6,827
19,733
(79)
(68)
393
27
-
-
(1,688)
(58,399)
29,724
26,987
Petrochemical
(15)
-
23
35
-
-
483
(4,736)
4,176
1,043
(97)
-
16
3
-
-
351
(848)
576
623
Oil and chemical product tranPowersportation generation services
(207)
(203)
23
21
-
-
693
(9,129)
56
9,766
Solvent
(49)
(26)
22
-
-
-
252
(1,452)
431
1,273
Ethanol
For the year ended 31 December 2014
(24)
-
1
-
-
-
68
(493)
561
-
Other
484
327
(1,753)
-
-
(5,963)
798
102,263
(101,465)
-
Eliminations
(2,163)
(478)
2,085
996
2,218
-
(4,060)
(394,150)
-
390,090
Total
(in million Baht)
ANNUAL REPORT 2014
Selling expenses
Other income
872
5,963
Dividend income
Net foreign exchange gain
(6,524)
(396,303)
59,114
330,665
Gross profit (loss)
rendering of services
Cost of sale of goods and
- Inter-segment
- External
rendering of services
Revenue from sale of goods
Oil refinery
Lube base oil refinery
Thai Oil Public Company Limited and its Subsidiaries
Information about reportable segments
29
NOTES TO TH E FINA NCIAL STATEMENTS
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
247
933
1,112
-
1,112
1,112
(306)
1,418
-
1,418
-
Lube base oil refinery
(1,520)
(53)
(1,467)
(1,520)
3
(1,523)
(108)
(1,415)
-
Petrochemical
1,125
-
1,125
1,125
(75)
1,200
(49)
1,249
723
148
50
98
148
-
148
(97)
245
(28)
Oil and chemical product tranPowersportation generation services
173
20
153
173
(41)
214
(113)
327
-
Solvent
134
77
57
134
-
134
(61)
195
(4)
Ethanol
For the year ended 31 December 2014
37
-
37
37
(8)
45
-
45
-
Other
(5,846)
228
(6,074)
(5,846)
-
(5,846)
208
(6,054)
53
Eliminations
(3,704)
322
(4,026)
(3,704)
920
(4,624)
(3,966)
(658)
744
Total
(in million Baht)
Fin a nci a l S t a t ement s
Profit (loss) for the year
933
Non-controlling interests
933
1,347
(414)
(3,746)
3,332
-
Owners of the Company
Attributable to :
Profit (loss) for the year
Reversal of income tax (expense)
tax expense
Profit (loss) before income
Finance costs
costs and income tax expense
Profit (loss) before finance
entities
and jointly-controlled
Oil refinery
Thai Oil Public Company Limited and its Subsidiaries
Share of gain of associates
29
NOTES TO TH E FINA NCIAL STATEMENTS
248 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
1,292 (3,412) 3,086
Net derivative gain on hedging
Net foreign exchange gain (loss)
Other income
Gain (loss) disposal of investment -
(1,892) -
(125)
(232)
166
29
-
-
2,171
-
(72)
(79)
444
242
-
-
4,110
(60,410)
31,335
33,185
Petrochemical
(898)
(16)
-
35
2
-
-
421
(4,995)
4,120
1,296
-
(202)
-
26
7
-
-
393
(838)
683
548
Oil and chemical product tranPowersportation generation services
-
(209)
(177)
20
21
-
-
792
(8,989)
79
9,702
Solvent
1
(53)
(17)
24
-
-
-
285
(1,220)
375
1,130
Ethanol
For the year ended 31 December 2013 (Restated)
-
(15)
-
24
-
-
-
74
(442)
513
3
Other
-
479
431
(1,751)
-
-
(3,039)
648
105,225
(104,577)
-
Eliminations
(897)
(2,105)
(477)
2,074
(3,111)
1,292
-
17,033
(397,542)
-
414,575
Total
(in million Baht)
ANNUAL REPORT 2014
Administrative expenses
(403)
3,039
Dividend income
Selling expenses
8,139
(24,783)
5,779
61,693
(401,090)
21,175
Lube base oil refinery
347,536
Gross profit
rendering of services
Cost of sale of goods and
- Inter-segment
- External
and rendering of services
Oil refinery
Thai Oil Public Company Limited and its Subsidiaries
Revenue from sale of goods
29
NOTES TO TH E FINA NCIAL STATEMENTS
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
249
6,051
-
Non-controlling interests 1,668
-
1,668
1,668
(340)
4,014
10
4,004
4,014
(631)
4,645
-
4,645
-
Petrochemical
44
6
38
44
(66)
110
(6)
116
572
146
28
118
146
(1)
147
(102)
249
25
Oil and chemical product tranPowersportation generation services
263
32
231
263
(74)
337
(110)
447
-
Solvent
213
99
114
213
-
213
(59)
272
32
Ethanol
For the year ended 31 December 2013 (Restated)
67
-
67
67
(16)
83
-
83
-
Other
(2,928)
47
(2,975)
(2,928)
-
(2,928)
257
(3,185)
47
Eliminations
9,538
222
9,316
9,538
(1,160)
10,698
(3,787)
14,485
676
Total
(in million Baht)
Fin a nci a l S t a t ement s
Profit for the year
6,051
6,051
(32)
Owners of the Company
Attributable to :
Profit for the year
Income tax expense
2,008
Profit before income tax expense 6,083
2,009
-
(1)
9,849
-
Lube base oil refinery
(3,766)
Finance costs
and income tax expense
Profit before finance costs
entities
and jointly-controlled
Oil refinery
Thai Oil Public Company Limited and its Subsidiaries
Share of gain of associates
29
NOTES TO TH E FINA NCIAL STATEMENTS
250 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
Investments in associates
jointly-controlled entities
Total liabilities
Other non-current liabilities
Debentures
from financial institutions
Long-term borrowings
100,973
2,895
60,734
-
7,296
11,589
-
18,459
153,047
5,004
41,159
1,794
78
-
-
240
-
-
1,476
10,703
72
2,932
-
-
-
4,120
2,810
769
Lube base oil refinery
6,902
34
-
2,564
547
-
-
3,757
26,827
750
20,123
-
-
-
1,660
828
3,466
Petrochemical
2,799
-
-
657
1,620
-
171
351
15,778
65
6,888
-
7,672
-
567
52
534
2,722
15
-
2,145
171
-
340
51
4,348
8
3,161
419
5
-
594
37
124
Oil and chemical product tranPowersportation generation services
4,248
47
-
970
2,615
-
158
458
6,768
1,598
2,181
-
-
-
930
586
1,473
Solvent
As at 31 December 2014
1,295
7
-
195
993
-
80
20
2,910
3
1,554
-
817
-
204
224
108
Ethanol
199
161
-
-
38
-
-
-
297
167
-
-
-
-
86
-
44
Other
(15,169)
(374)
-
-
(8,035)
-
-
(6,760)
(27,876)
(1,755)
1,000
-
2,256
(14,545)
(7,997)
(41)
(6,794)
Eliminations
105,763
2,863
60,734
6,531
5,485
11,589
749
17,812
192,802
5,912
78,998
419
12,011
-
50,788
28,533
16,141
Total
(in million Baht)
ANNUAL REPORT 2014
Other current liabilities
Current portion of debenture
from financial institutions
long-term borrowings
Current portion of
Trade accounts payable
Total assets
Other non-current assets
Property, plant and equipment
-
1,261
Investments in subsidiaries
Investments in
50,624 14,545
Other current assets
16,417 24,037
Inventories
Oil refinery
Thai Oil Public Company Limited and its Subsidiaries
Trade accounts receivable
29
NOTES TO TH E FINA NCIAL STATEMENTS
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
251
76
2,719
6,620
37
-
1,953
-
-
1,029
58
-
172
694
11,438
33
2,164
-
7,097
-
1,558
2,556
15
-
2,061
175
-
263
42
4,081
7
2,737
422
7
-
675
40
193
4,489
43
-
950
2,755
-
-
741
6,849
1,308
1,902
-
-
-
965
756
1,918
Solvent
1,525
13
-
275
1,094
-
50
93
2,998
3
1,520
-
821
-
154
362
138
Ethanol
190
137
-
-
43
-
-
10
311
141
-
-
-
-
63
-
107
Other
(19,959)
(319)
-
-
(9,039)
-
-
(10,601)
(30,246)
(1,405)
634
-
2,113
(11,920)
(8,975)
(26)
(10,667)
Eliminations
113,681
2,721
57,070
4,315
5,206
12,330
485
31,554
208,662
4,324
65,468
422
11,299
-
49,894
48,509
28,746
Total
and rendering of services
Revenue from one customer represents approximately Baht 173,581 million (2013: Baht 192,982 million) of the Group’s revenue from sale of goods
Major customer
-
57,070 2,680
-
298
9,369
113,627
453
-
-
-
-
12,330
31,153 6,130
13,115 2,306
32,139
168,963
769
16,678
-
5,621
49
537
Oil and chemical product tranPowersportation generation services
As at 31 December 2013 (Restated)
(in million Baht)
Fin a nci a l S t a t ement s
Total liabilities
Trade accounts payable Current portion of long-term borrowings from financial institutions Current portion of debenture Other current liabilities Long-term borrowings from financial institutions Debentures Other non-current liabilities
Total assets
68
3,400
-
3,275
-
1,261 -
-
36,558
-
4,659
45,174 11,920
1,740
1,886 3,227
6,345
Petrochemical
28,289
Lube base oil refinery
42,361
Oil refinery
Thai Oil Public Company Limited and its Subsidiaries
Trade accounts receivable Inventories Other current assets Investments in subsidiaries Investments in associates Investments in jointly-controlled entities Property, plant and equipment Other non-current assets
29
NOTES TO TH E FINA NCIAL STATEMENTS
252 THAI OIL PUBLIC COMPANY LIMITED ANNUAL REPORT 2014
253
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 27
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Other income (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2014
2013
2013 (Restated)
Interest income
1,082
1,596
1,157
1,634
Land lease income
38
18
79
68
Service income
52
50
1,160
1,075
Reversal of impairment loss
386
-
386
-
Other
527
410
440
309
2,085
2,074
3,222
3,086
Total
28
Administrative expenses (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
Advisory and legal fees
104
221
96
213
Personnel expenses
839
881
670
703
91
98
54
59
-
108
-
-
Other
1,129
797
1,254
916
Total
2,163
2,105
2,074
1,891
Depreciation Impairment loss on asset
254
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29 29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Employee benefit expenses (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
199
204
146
156
Contributions to provident fund
18
19
14
16
Retirement gratuity fund
12
14
12
14
Other
76
137
66
95
305
374
238
281
1,861
1,830
1,258
1,289
Contributions to provident fund
124
117
97
94
Retirement gratuity fund
149
141
149
141
Other
443
379
312
300
2,577
2,467
1,816
1,824
2,882
2,841
2,054
2,105
Management Salaries and wages
Other employees Salaries and wages
Total
The Group established a contributory registered provident fund to which the employees contribute monthly at rates ranging from 2% to 15% of their basic salaries and by the Group at rates ranging from 2% to 15% of the employees’ basic salaries. Membership to the funds is on a voluntary basis. The provident funds are registered with the Ministry of Finance as juristic entities and are managed by licensed Fund Managers.
255
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 30
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Expenses by nature
The statements of income include an analysis of expenses by function. Significant expenses by nature are detailed as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2014
2013
2013 (Restated)
Changes in finished goods and work in progress
6,488
(1,596)
5,622
(2,064)
347,614
362,347
361,286
375,403
Natural gas used
8,105
7,506
3,950
3,177
Employee benefits expense
2,881
2,841
2,054
2,105
Depreciation and amortisation
6,512
6,033
4,292
3,820
15,140
14,491
15,140
14,491
Purchase and raw materials used
Excise tax
31
Finance costs (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
3,796
3,736
3,663
3,720
191
55
83
46
3,987
3,791
3,746
3,766
(21)
(5)
-
-
3,966
3,786
3,746
3,766
Interest expense: financial institutions and other Financial expenses
Capitalised as cost of property plant and equipment under construction Net
256
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29 32
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Expense (reversal) of income tax (in million Baht)
Note
Consolidated
Separate
financial statements
financial statements
2014
2014
2013
2013 (Restated)
Current tax expense Current year Adjustment for prior years
Deferred tax expense
401
1,393
-
238
(15)
-
(43)
-
(1,306)
(233)
(1,304)
(206)
(920)
1,160
(1,347)
32
18
Movements in temporary differences Total
Reconciliation of effective tax rate (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2014
2013
2013 (Restated)
Profit (loss) before income tax expense
(4,624)
10,698
(413)
6,083
(925)
2,140
(83)
1,217
Income not subject to tax
(30)
(1,156)
(1,283)
(1,336)
Expenses not deductible for tax purposes
66
183
62
151
Utilisation of previously unrecognised tax losses
(16)
(7)
-
-
Over provided in prior years
(15)
-
(43)
-
(920)
1,160
(1,347)
32
Income tax using the Thai corporation tax rate
Total
THAI OIL PUBLIC COMPANY LIMITED
29
257 Fi n an c i al Statements
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Income tax reduction Royal Decree No. 530 B.E. 2554 dated 21 December 2011 grants a reduction in the corporate income tax rate for the three accounting periods 2012, 2013 and 2014; from 30% to 23% for the accounting period 2012 which begins on or after 1 January 2012 and to 20% for the following two accounting periods 2013 and 2014 which begin on or after 1 January 2013 and 2014, respectively. Royal Decree No. 577 B.E. 2557 dated 10 November 2014 extends the reduction to 20% for the accounting period 2015 which begins on or after 1 January 2015 The Group has applied the reduced tax rate of 20% in measuring deferred tax assets and liabilities as at 31 December 2014 and 2013 in accordance with the clarification issued by the FAP in 2012.
33
Promotional privileges
By virtue of the provisions of the Industrial Investment Promotion Act of B.E. 2520, the Company and certain local subsidiaries have been granted privileges by the Board of Investment relating to oil refinery, power and steam generation, petroleum product production, chemical product production, ethanol product production, marine transportation, offshore crude oil unloading facilities and industrial zone. The privileges granted include: a)
an exemption from payment of import duty and tax on machinery and equipment as approved by the Board of Investment.
b) an exemption from payment of corporate income tax for promoted operations for periods of 3 to 8 years from the dates on which the income is first derived from such operations or 8 years from the date on which the income is received subsequent to when the privileges were granted, and c) a 50% reduction in the normal corporate income tax rate on the net profit derived from certain promotional operations for a period of five years, commencing from the expiry date in (b) above As promoted companies, the Company and its subsidiaries must comply with certain conditions and restrictions provided for in the promotional certificates.
258
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Summary of revenue from promoted and non-promoted businesses: (in million Baht)
Consolidated financial statements
Export sales Local sales
2014
2013 (Restated)
Non-
Non-
Promoted
promoted
Promoted
promoted
businesses
businesses
Total
businesses
businesses
Total
42,646
28,922
71,568
56,395
22,275
78,670
325,168
98,078
423,246
359,351
84,414
443,765
Eliminations
(104,724)
(107,860)
Total revenues
390,090
414,575
(in million Baht)
Separate financial statements
Export sales Local sales Total revenues
2014
2013
Non-
Non-
Promoted
promoted
Promoted
promoted
businesses
businesses
Total
businesses
businesses
Total
33,498
3,831
37,329
40,986
3,530
44,516
312,486
39,964
352,450
333,774
30,939
364,713
389,779
409,229
259
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 34
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Basic earnings (losses) per share
The calculations of basic earnings (losses) per share for the years ended 31 December 2014 and 2013 were based on the profit (loss) for the years attributable to owners of the Company and the weighted average number of ordinary shares outstanding during the years as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2014
2013
2013 (Restated)
Profit (loss) for the year attributable to owner of the Company
(4,026)
9,316
934
6,051
2,040
2,040
2,040
2,040
4.57
0.46
2.97
Weighted average number of ordinary shares outstanding during the year Basic earnings (losses) per share (in Baht)
35
(1.97)
Dividends
At the meeting of the Board of the Directors of the Company held on 29 August 2014, the Company’s Board of Directors approved the appropriation of 2014 interim dividends at Baht 0.56 per share, totalling Baht 1,142 million. The interim dividends were paid to the Company’s shareholders in September 2014. At the annual general meeting of the shareholders of the Company held on 2 April 2014, the Company’s shareholders approved the appropriation of 2013 annual dividends at Baht 2.30 per share, totalling Baht 4,692 million. After a deduction of the interim dividends of Baht 0.80 per share which were already paid to the Company’s shareholders in September 2013, the remaining dividends of Baht 1.50 per share, totalling Baht 3,060 million, were already paid to the Company’s shareholders in April 2014. At the meeting of the Board of the Directors of the Company held on 31 August 2013, the Company’s Board of Directors approved the appropriation of 2013 interim dividends at Baht 0.80 per share, totalling Baht 1,632 million. The interim dividends were paid to the Company’s shareholders in September 2013. At the annual general meeting of the shareholders of the Company held on 2 April 2013, the Company’s shareholders approved the appropriation of 2012 annual dividends at Baht 2.70 per share, totalling Baht 5,508 million. After a deduction of the interim dividends of Baht 0.50 per share which were paid to the Company’s shareholders in September 2012, the remaining dividends of Baht 2.20 per share, totalling Baht 4,488 million, were paid to the Company’s shareholders in April 2013.
260
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29 36
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Financial instruments
Financial risk management policies The Group is exposed to normal business risks from changes in market interest rates and currency exchange rates and from non-performance of contractual obligations by counterparties. The Group does not hold or issue derivative financial instruments for speculative or trading purposes. Risk management is integral to the whole business of the Group. The Group has a system of controls in place to create an acceptable balance between the cost of risks occurring and the cost of managing the risks. The management continually monitors the Group’s risk management process to ensure that an appropriate balance between risk and control is achieved.
Capital management The objectives of the Group’s capital management are to safeguard the Group’s ability to continue as a going concern in order to provide returns to the Group’s shareholders and benefits to other stakeholders. The management sets strategies to support the Group’s operations for more efficiency, and better performances and stronger financial status, including dividend and capital management policies to maintain the optimal capital structure and cost of capital.
Interest rate risk Interest rate risk is the risk that future movements in market interest rates will affect the results of the Group’s operations and its cash flows. Hence, the Group has hedging agreements with various investment-grade financial institutions to protect against the risk of rising interest rates. The effective interest rates of loans as at 31 December 2014 and 2013 and the periods in which those assets mature were as follows: Consolidated financial statements Effective interest rate
Within 1 year
(% per annum)
After 1 year
Total
(in million Baht)
2014 Non-current Long-term loans to savings co-operative of employees Loans to employees Total
MLR less margin MMR less margin
44
651
695
1
2
3
45
653
698
261
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Consolidated financial statements Effective interest rate
Within 1 year
(% per annum)
After 1 year
Total
(in million Baht)
2013 Non-current Long-term loans to savings co-operative of employees Loans to employees
MLR less margin MMR less margin
Total
42
598
640
1
4
5
43
602
645
Separate financial statements Effective interest rate
Within 1 year
(% per annum)
After 1 year
Total
(in million Baht)
2014 Current Short-term loans to subsidiaries
MMR rate not exceeding the average MLR of 5 banks less margin
4,013
-
4,013
44
651
695
4,057
651
4,708
2,923
-
2,923
42
598
640
2,965
598
3,563
Non-current Long-term loans to savings
MLR less margin
co-operative of employees Total 2013 Current Short-term loans to subsidiaries
MMR rate not exceeding the average MLR of 5 banks less margin
Non-current Long-term loans to savings
MLR less margin
co-operative of employees Total
The effective interest rates of borrowings from financial institutions and debentures as at 31 December 2014 and 2013 and the periods in which those liabilities mature were disclosed in note 20 to the financial statements.
262
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Foreign currency risk The Group is exposed to foreign currency risk relating to purchases of raw materials and long-term borrowings which are denominated in foreign currencies. However, the Group enters into short-term currency hedging contracts for short term foreign currency exposures when appropriate. As at 31 December 2014 and 2013 the Group was exposed to foreign currency risk in respect of financial assets and liabilities denominated in the following currencies: (in million Baht)
Consolidated
Separate
financial statements
financial statements
Note
2014
2013
2014
2013
Cash and cash equivalents
7
5,187
5,478
4,709
5,031
Trade accounts receivable
9
4,659
7,621
3,229
4,982
512
186
511
186
U.S. Dollars
Other receivables Interest-bearing liabilities
20
(46,823)
(51,400)
(46,823)
(51,400)
Trade accounts payable
21
(2,061)
(13,047)
(1,934)
(12,873)
(318)
(226)
(67)
(208)
(38,844)
(51,388)
(40,375)
(54,282)
Other payables
Other currencies Cash and cash equivalents
7
109
17
-
-
Trade accounts receivable
9
201
282
-
-
1
4
-
2
-
(130)
-
-
Other receivables Interest-bearing liabilities
20
Trade accounts payable
21
Other payables
(2)
-
-
-
(49)
(46)
(49)
(45)
260
127
(49)
(43)
(38,584)
(51,261)
(40,424)
(54,325)
3,944
(599)
115
-
(34,640)
(51,860)
(40,309)
(54,325)
Gross exposure in statement of financial position Currency forwards Net exposure
263
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Credit risk Credit risk is the potential financial loss resulting from the failure of a customer or counterparty to settle its financial and contractual obligations to the Group as and when they fall due. The Group has no significant credit risk with any single counterparty or group of counterparties since the Group maintains business with large customers in petroleum and power industries and requires full first class collateral for the rest.
Liquidity risk The Group monitors its liquidity risk and maintains a level of cash and cash equivalents deemed adequate by management to finance the Group’s operations and to mitigate the effects of fluctuations in cash flows.
Fair values The fair value is the amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length transaction. The following methods and assumptions are used by the Group to estimate the fair value of each class of financial instrument. The fair value of cash and cash equivalents, trade and other short-term receivables is taken to approximate the carrying value due to the relatively short-term maturity of these financial instruments. The fair values of investments in equity securities, which are available for sales, are determined by reference to their net asset value at the reporting date. The fair value of bank overdrafts and short-term borrowings from financial institutions and trade accounts payable and others, are taken to approximate their fair values due to the relatively short-term maturity of these financial instruments. The fair value of long-term loans and borrowings carrying a floating rate, which is considered to be market rate, are taken to approximate their fair values. The fair value of non-derivative financial liabilities, which is determined for disclosure purposes, is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the reporting date or based on market price, if available.
264
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Fair values of debentures, together with the carrying values shown in the statement of financial position as at 31 December 2014 and 2013 were as follows: (in million Baht)
Consolidated
Separate
financial statements
financial statements
Fair
Carrying
Fair
Carrying
value
value
value
value
11,764
11,589
11,764
11,589
Debentures
62,487
60,734
62,487
60,734
Total
74,251
72,323
74,251
72,323
11,753
12,330
11,753
12,330
Debentures
53,554
57,070
53,554
57,070
Total
65,307
69,400
65,307
69,400
2014 Current Debentures
Non-current
2013 Current Debentures
Non-current
265
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 37
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Commitments with non-related parties (in million Baht)
Consolidated
Separate
financial statements
financial statements
2014
2013
2014
2013
10,535
22,955
1,604
15,035
1,130
1,113
-
-
764
750
-
-
12,429
24,818
1,604
15,035
Within one year
208
208
201
201
After one year but within five years
903
851
872
842
After five years
786
852
621
852
1,897
1,911
1,694
1,895
82
134
-
-
Forward exchange contracts
3,944
599
115
-
Letters of guarantee issued by financial institutions
1,288
584
290
404
Crude oil purchase agreements
31,279
45,617
31,279
45,617
Total
36,593
46,934
31,684
46,021
Capital commitments Project construction agreements License agreement Other agreement Total
Non-cancellable operating lease commitments
Total
Other commitments Inventory management services agreements
Power Purchase Agreements The Electricity Generating Authority of Thailand (“EGAT�) has a power purchase agreement for a period of 25 years with a subsidiary expiring in 2023 whereby the subsidiary will supply the electric energy to EGAT at the agreed quantity and price. As the contracted party with EGAT, the subsidiary must comply with conditions and restrictions provided for in the agreement.
266
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29 38
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Contingent liabilities and contingent assets
As at 31 December 2014 the Group had the following contingent liabilities and contingent assets: a) The Company has crack spread swap and time spread swap with foreign companies (“counterparties”). The Company has or the counterparties have commitments to make payments for the differences between the fixed price and floating price for each period. As at 31 December 2014 the Company had oil volume under the agreements totaling 15.8 million barrels (2013: 20.7 million barrels). b) The Company has commodity option agreements with foreign companies (“counterparties”). The Company has or the counterparties have commitments to make payments for the differences between the strike price and floating price of the crude oil price at maturity date. As at 31 December 2014 the Company had no crude oil volume under the agreements (2013: Baht 0.3 million).
39
Insurance policy
As at 31 December 2014 the Group has an All Risks and Loss of Profit Insurance Policy (“ALOP”) from a syndicate of insurers and reinsurers for a total insured value of U.S. Dollars 9,513 million (2013: U.S. Dollars 9,242 million). Such policy is renewed on an annual basis. Certain subsidiaries have assigned their rights to proceeds from insurance claims under the ALOP to the lenders under certain borrowings agreements.
40
Event after the reporting period
At the meeting of the Board of Directors of the Company held on 12 February 2015, the Company’s Board of Directors approved the submission for approval at the annual general meeting of the shareholders of the Company the appropriation of 2014 annual dividends at Baht 1.16 per share, totalling Baht 2,366 million. After a deduction of the interim dividends of Baht 0.56 per share which were paid to the Company’s shareholders in September 2014, the remaining dividends of Baht 0.60 per share, totalling Baht 1,224 million, are scheduled for payment on 29 April 2015. This dividend is subject to the approval of the Company’s shareholders at the annual general meeting to be held on 3 April 2015.
267
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29 41
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Thai Financial Reporting Standards not yet adopted
A number of new and revised TFRS have been issued but are not yet effective and have not been applied in preparing these financial statements. Those new and revised TFRS become effective for annual financial periods beginning on or after 1 January in the year indicated in the following table, are as follow;
TFRS
Topic
TAS 1 (revised 2014)
Presentation of Financial Statements
2015
TAS 2 (revised 2014)
Inventories
2015
TAS 7 (revised 2014)
Statement of Cash Flows
2015
TAS 8 (revised 2014)
Accounting Policies, Changes in Accounting Estimates and Errors
2015
TAS 10 (revised 2014)
Events after the Reporting Period
2015
TAS 11 (revised 2014)
Construction Contracts
2015
TAS 12 (revised 2014)
Income Taxes
2015
TAS 16 (revised 2014)
Property, Plant and Equipment
2015
TAS 17 (revised 2014)
Leases
2015
TAS 18 (revised 2014)
Revenue
2015
TAS 19 (revised 2014)
Employee Benefits
2015
TAS 20 (revised 2014)
Accounting for Government Grants and Disclosure of Government Assistance
Year effective
2015
TAS 21 (revised 2014)
The Effects of Changes in Foreign Exchange Rates
2015
TAS 23 (revised 2014)
Borrowing Costs
2015
TAS 24 (revised 2014)
Related Party Disclosures
2015
268
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
TFRS
Topic
Year effective
TAS 26 (revised 2014)
Accounting and Reporting by Retirement Benefit Plans
2015
TAS 27 (revised 2014)
Separate Financial Statements
2015
TAS 28 (revised 2014)
Investments in Associates and Joint Ventures
2015
TAS 29 (revised 2014)
Financial Reporting in Hyperinflationary Economies
2015
TAS 33 (revised 2014)
Earnings per Share
2015
TAS 34 (revised 2014)
Interim Financial Reporting
2015
TAS 36 (revised 2014)
Impairment of Assets
2015
TAS 37 (revised 2014)
Provisions, Contingent Liabilities and Contingent Assets
2015
TAS 38 (revised 2014)
Intangible Assets
2015
TAS 40 (revised 2014)
Investment Property
2015
TFRS 2 (revised 2014)
Share-based Payment
2015
TFRS 3 (revised 2014)
Business Combinations
2015
TFRS 4 (revised 2014)
Insurance Contracts
2016
TFRS 5 (revised 2014)
Non-current Assets Held for Sale and Discontinued Operations
2015
TFRS 6 (revised 2014)
Exploration for and Evaluation of Mineral Resources
2015
TFRS 8 (revised 2014)
Operating Segments
2015
TFRS 10
Consolidated Financial Statements
2015
TFRS 11
Joint Arrangements
2015
TFRS 12
Disclosure of Interests in Other Entities
2015
TFRS 13
Fair Value Measurement
2015
269
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
TFRS
Topic
TSIC 10 (revised 2014)
Government Assistance - No Specific Relation to Operating Activities
TSIC 15 (revised 2014)
Operating Leases - Incentives
TSIC 25 (revised 2014)
Income Taxes - Changes in the Tax Status of an Entity or its Shareholders
TSIC 27 (revised 2014)
Year effective
2015 2015
2015
Evaluating the Substance of Transactions Involving the Legal Form of a Lease
2015
TSIC 29 (revised 2014)
Service Concession Arrangements: Disclosures
2015
TSIC 31 (revised 2014)
Revenue - Barter Transactions Involving Advertising Services
2015
TSIC 32 (revised 2014)
Intangible Assets - Web Site Costs
2015
TFRIC 1 (revised 2014)
Changes in Existing Decommissioning, Restoration and Similar Liabilities
TFRIC 4 (revised 2014)
Determining whether an Arrangement contains a Lease
TFRIC 5 (revised 2014)
Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds
TFRIC 7 (revised 2014)
2015 2015
2015
Applying the Restatement Approach under TAS 29 (revised 2014) Financial Reporting in Hyperinflationary Economies
2015
TFRIC 10 (revised 2014)
Interim Financial Reporting and Impairment
2015
TFRIC 12 (revised 2014)
Service Concession Arrangements
2015
TFRIC 13 (revised 2014)
Customer Loyalty Programmes
2015
270
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
29
ANNUAL REPORT 2014
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
TFRS
Topic
TFRIC 14
TAS 19 (revised 2014) - The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction
Year effective
2015
TFRIC 15 (revised 2014)
Agreements for the Construction of Real Estate
2015
TFRIC 17 (revised 2014)
Distributions of Non-cash Assets to Owners
2015
TFRIC 18 (revised 2014)
Transfers of Assets from Customers
2015
TFRIC 20
Stripping Costs in the Production Phase of a Surface Mine
2015
The Group has made a preliminary assessment of the potential initial impact on the financial statements of those new and revised TFRS assessed to have the greatest potential impact on the financial statements in the period of initial application. These new and revised TFRS are as follows:
TFRS 10 – Consolidated Financial Statements and TFRS 12 – Disclosures of Interests in Other Entities TFRS 10 provides a control model to determine which investee to be consolidated, as a result, the Parent company has control over the Group. The Group needs to derecognise fair value derived from business combination under purchase method, and apply the similar to pooling of interest method under the accounting practice for business combination under common control. TFRS 12 brings together into a single standard all the disclosure requirements about an entity’s interests in its subsidiaries, joint arrangements, associates and unconsolidated structured entities. The Group is currently assessing these disclosure requirements in comparison with the existing disclosures. TFRS 12 requires the disclosure of information about the nature, risks and financial effects of these interests.
271
THAI OIL PUBLIC COMPANY LIMITED
Fi n an c i al Statements
ANNUAL REPORT 2014
29
NOTES TO THE FINANCIAL STATEMENTS Thai Oil Public Company Limited and its Subsidiaries
Management estimates that the impact on the consolidated financial statements will be as follows: (in million Baht)
Consolidated statement of income for the year ended 31 December 2014 Increase in cost of sales of goods and rendering services
21
Decrease in share of profit of associates
114
Total increase in net loss
135
Total increase in basic loss per share (in Baht)
0.07
(in million Baht)
Consolidated statement of financial position
31 December
1 January
2014
2014
Increase in investment in associates
684
798
Increase in property, plant and equipment
121
142
Increase in surplus on business restructuring under common control
331
331
Increase in retained earnings
364
478
Increase in non-controlling interests
110
131
272
THAI OIL PUBLIC COMPANY LIMITED
Fin a nci a l S t a t ement s
30
ANNUAL REPORT 2014
AUDIT FEES OF THE AUDITORS 2014
1. Audit Fees The company, subsidiaries and Thaioil Group Registered Provident Fund paid for the audit fees to the auditors’ company for the latest account period amounting to Baht 6,303,000 (six million three hundred and three thousand baht only).
2. Non-Audit Fees The company and subsidiaries paid for non-audit fees for monitoring the performance compliance with the condition of the BOI Promotion Certificate to the auditor’s company for the latest account period amounting to Baht 795,000 (seven hundred and ninety five thousand baht only).
Professionalism
Ownership and Commitment
Social Responsibility
Integrity
Teamwork and Collaboration
Initiative
Vision Focus
Excellence Striving
Bangkok Office
Sriracha Office and Refiner y
555/1 Energy Complex Building A, 11 th Floor,
42/1 Moo 1, Sukhumvit Road Km. 124, Tungsukla,
Vibhavadi Rangsit Road, Chatuchak, Chatuchak,
Sriracha, Chonburi 20230, Thailand
Bangkok 10900, Thailand
Tel: +66(0)-3840-8500, +66(0)-3835-9000
Tel: +66(0)-2797-2999, +66(0)-2797-2900, +66(0)-2299-0000
Fax: +66(0)-3835-1554, +66(0)-3835-1444
Fax: +66(0)-2797-2970
www.thaioilgroup.com
www.thaioilgroup.com