PTT Pcl (PTT), Thailand’s importer of liquefied natural gas, bought four spot cargoes on an oil-linked price formula, according to two people with knowledge of the transaction.
The shipments are for December to March delivery, said the people, who asked not to be identified because they aren’t authorized to speak to the media. LNG price formulas linked to crude, including Brent and the so-called Japan Crude Cocktail, are usually used in long-term contracts that are typically more than 10 years.
The state-owned company will also burn an additional 30,000 metric tons a month of fuel oil supplied locally to generate power because LNG spot cargoes are expensive, one of the people said.
The cost of LNG for delivery to Northeast Asia over the next four to eight weeks increased to $18.10 per million British thermal units, New York-based Energy Intelligence Group said on the website of its World Gas Intelligence publication on Nov. 13. Spot prices are on par with term-contract costs, it said.
To contact the reporter on this story: Chou Hui Hong in Singapore at firstname.lastname@example.org
To contact the editor responsible for this story: Alexander Kwiatkowski at email@example.com