Caltex Petroleum has signed an agreement with Thailand's government covering construction of the country's fifth refinery.
It is the third agreement involving foreign companies' investment in a major refinery project in Thailand in recent months.
Exxon Corp.'s Esso Standard Thailand Ltd. earlier this month disclosed signing of an agreement allowing it to proceed with a major expansion of its Sri Racha refinery to 185,000 b/d by 2000 from the current 63,000 b/d (OGJ, Jan. 13, p. 21).
And a unit of Royal Dutch/Shell Group last year signed a formal agreement calling for construction of Thailand's fourth refinery, a 145,000 b/d plant at Mab Ta Phud, Rayong province (OGJ, Nov. 11, 1991, p. 31).
CALTEX REFINERY
The Caltex project calls for a 120,000 b/d refinery to be built in Rayong province with start-up scheduled for 1996, a year later than that planned for the Shell project.
Early estimates place construction cost at $520 million, but industry officials think the project will cost more. Caltex has not released a revised estimate.
Much of the terms in the Caltex contract resemble those of the Shell project contract.
A notable exception is a clause allowing Caltex to allot some interests in the project to an unspecified oil producing country when there is a public offering of shares in a new subsidiary to be created to operate the refinery (OGJ, Mar. 25, 1991, p. 40). The Thai government agreed to the clause because it strengthens the security of crude supply to the refinery.
Caltex officials said the company has begun initial talks with Oman's state petroleum authority to take as much as a 20% interest in the project. The Omani government would retain only an equity stake and not be in involved in refinery operation, officials said. Caltex also has appointed Britain's Barclay banking group as project financial adviser.
Meantime, Caltex said front end engineering design work has shown good progress since it got under way about 5 months ago. Front end design is to be complete by mid-1992.
ESSO EXPANSION
Esso Thailand let contracts for Sri Racha engineering, procurement, and construction to Foster Wheeler Energy Ltd., Foster Wheeler International Corp. (Thailand branch), and Foster Wheeler (Pacific) Ltd.
In addition to expanding capacity, the project will boost production of clean, light products by adding several conversion and desulfurization units. Foster Wheeler said the expansion project includes building 16 process units plus offsites and utilities. It is scheduled for completion before yearend 1995.
But the construction schedule will allow units to produce unleaded gasoline and low sulfur diesel by 1993.
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