Bangkok Aviation Fuel Services Plc (BAFS) plans to build a new oil pipeline to link networks together, in order to boost its trade in the northern region.
A 52-kilometre pipeline will run from Saraburi to Ang Thong. These two provinces will facilitate oil transportation from the East to the North.
The cost of construction is estimated at 1.2 billion baht, said Nathasit Diskul, president of BAFS, adding that the investment is not in the company's capital spending plan which was announced earlier.
BAFS is in talks with Thai Petroleum Pipeline Co over the new oil pipeline project.
Thai Petroleum Pipeline, with PTT Oil and Retail Business Plc as the largest shareholder, currently operates an oil pipeline network connecting refineries in the eastern region.
BAFS's oil storage in the Laksi area of northern Bangkok also uses this oil pipeline network. Its oil storage serves planes at Don Mueang airport.
BAFS's subsidiary Fuel Pipeline Transportation runs an oil pipeline connecting Bangchak Corporation Plc's oil refinery in Ayutthaya's Bang Pa-in district to the northern province of Lampang.
The Ayutthaya-Lampang pipeline started operations under the first phase in 2019. In 2021, it provided a full service with an oil-carrying capacity of 2.45 billion litres a year.
In 2022, only 20% of the total capacity, or around 410 million litres, was used, according to Fuel Pipeline Transportation.
Transporting oil to the northern provinces would help support the government's campaign to reduce the level of carbon dioxide emitted by trucks.
At the 26th UN Climate Change Conference in Glasgow in 2021, Prime Minister Prayut Chan-o-cha vowed that Thailand would be more aggressive in addressing climate change and strive to reach carbon neutrality, a balance between carbon dioxide emissions and absorption, by 2050, along with a net-zero target, a balance between greenhouse gas emissions and absorption, by 2065.
According to BAFS, the Ayutthaya- Lampang pipeline is responsible for a reduction of up to 153,000 tonnes of carbon dioxide per year.
ML Nathasit said he expects the new oil pipeline project to be finalised in the next two months.
The construction design has already been completed. The company was also granted permission to build underground pipelines and those located near highways.
It is waiting for the authorities to approve its Environmental Impact Assessment report in order to push ahead with the project.
ML Nathasit said the company is considering revising up its sales target of jet fuel this year, from the previous projection of 4.2 billion litres, due to an increase in flights from China.
During the first half of 2023, the number of flights serving Chinese destinations stood at 100-125 a week. This will rise to 400-500 flights between July and the end of this year, said ML Nathasit.
ML Nathasit expects jet fuel sales to reach 1.9 billion litres in the first six months of 2023. He believes the sales volume will increase in the second half of this year, driven by tourism.
BAFS's jet fuel sales stood at 2.9 billion litres last year.
