A flagship refinery of PTT Plc, Thaioil has evolved since its foundation in 1961: from a petroleum refinery producing a modest 35,000 barrels a day, into Thailand’s largest oil player, with current capacity standing at 275,000 barrels a day. Despite its mature age, the refinery has stood the test of time and has been carefully preserved and modernised to comply with global standards.
But the company has more strings to its bow than an eminent refinery that has aged remarkably well. “Thaioil has changed a lot since it was founded,” says Surong Bulakul, the company’s CEO. “It is no longer based around an oil refinery exclusively: we’re now a fully integrated company that also deals in electricity and sustainable energy.
“The cornerstones of the company are efficiency, flexibility and reliability,” he says. “The flexibility in our operation gives us the ability to produce a high value of products; reliability gives the ability to manage the reliable products and services to our customers. The Thaioil refinery is 50 years old and has been highly utilised at more than 100 percent – efficiency means effectiveness in all areas to make the lowest possible operating cost.
“These are the ablilties that allow us to fully utilise all our assets for the most benefit. Refining is certainly not a sunrise industry, but we are fortunate to be in the middle of a region where demand is still increasing. Asia has immense growth potential,” the CEO says.
A new beginning
With Surong Bulakul at the helm – he took the reins in 2010, after holding a string of executive positions at Thaioil’s parent group, PTT – the company has expanded within new markets and has moved into higher value products. “The business model is quite unique, and we keep modernising it by introducing innovative concepts and products using efficient technologies,” Bulakul says. “We have also given added value to its existing value chain by converting commodity products, such as petroleum, into specialty products.”
Currently the company covers areas including lubricant base oil, petrochemical, ethanol and power generation. So as not to become stagnant on the market, Thaioil constantly re-evaluates its offerings to provide solutions that benefit its clients – and the community in which the company is based.
So what defines the work ethic of Thaioil’s new CEO? “In terms of management I believe that communication is everything, and it will promote a high-performance organisation with excellent teamwork in place,” he says. “It’s crucial to be able to be in top quartile on performance and return on investment, as well as to create innovation and credibility in terms of sustainability. Another crucial part of my role as CEO is to keep our staff happy and to keep them involved in the business operations, as well as allowing them to have a say in community projects.”
Bulakul’s philanthropic leanings rub off across the entire spectrum of the company. Notably, the company has received an award for managing to wholly prevent accidents at its factories in 2010. “The reason … is that we employ preventative and minutely executed measures to avoid accidents,” Bulakul says. “We would be prepared to go to any length to protect our employees and community.”
The future is green
As a leading force in the sustainable stakes, ‘Think Green’ could well be Thaioil’s mantra. To further its position as a green industry maven, the company is taking active measure to develop and provide environmentally-friendly products. “Our expertise in oil and gas has led us to renewable energy, and through to becoming an energy converting company,” says Bulakul. “One of our highest priorities is to adhere to sustainable standards in order to contribute to building a sustainable future. These days, companies, including Thaioil, can’t justify dealing with nasty products that are harmful to the environment and human health.”
“We fully take advantage of the universal eco trend, and our products score higher on the sustainable scale than the set government standard,” he says. “As the journey of Thaioil continues, we will strive to make any changes and improvements necessary to align the business with new requirements.”
In keeping with the government’s policy to support and spur renewable energy production and consumption, Thaioil established Thaioil Ethanol: a wholly-owned subsidiary which functions as the ethanol arm of the business and delivers a string of related products.
The ethanol industry might not be entirely free of controversy, as critics deem it too taxing on farmland that would be better used for food crops. But no one can deny that it comes with obvious benefits such as affordability and sustainable properties. “We’re hoping that Gasohol will outdo fossil fuel in the future, and it is certainly a viable replacement,” stresses Bulakul.
Gasohol is a form of fuel made up of gasoline and ethanol. Currently these are combined in a 9:1 ratio, but to make the product even greener, Thaioil is trying to develop a way to increase the percentage of ethanol. The company is currently spending substantial R&D resources to achieve this particular goal.
In order to increase the production of ethanol, Thaioil is involved in Maesod Clean Energy Company, which boasts a daily output of 200,000 litres of ethanol from inedible sugarcane. It is a joint venture in which Thaioil holds 30 percent, while Petro Green and Padaeng Industry own the remainder part. Thaioil also owns a 50 percent stake in Sapthip, which outputs similar ethanol quantities daily, with the other half belonging to one of Thailand’s major cassava exporters.
A good corporate citizen
The issue of corporate responsibility is close to the heart of Thaioil. Because few middle-men are involved in the production of ethanol, its increased use directly benefits the farmers of the product. Hence, Thaioil’s business model adds value to local farmers, because profits go directly to the individuals working in the Thai agricultural sector, particularly those focusing on farming sugarcane and cassava – approximately 10 percent of the country’s farmers – which are the two main resources used to produce ethanol.
As well as supporting farmers, Thaioil constantly orchestrates projects, large and small, to support people in the community. A recent project saw the company install a micro-turbine generator in a waterfall found in a remote village in Thailand. The resident cabbage and rice farmers benefited greatly from the initiative, since they had previously lived entirely without electricity. “The electricity that is now generated in the village is of the green variety, but most importantly it has transformed the farmers’ lives,” says Bulakul. “At last they are able to benefit from the gadgets of civilisation such as lightbulbs and TVs, and they can now also access the internet, which not only brings them pleasure and a means to communicate, but will enable them to check on current market prices for their stock, as well give them the chance to monitor weather forecasts and other important news.”
About 1,000 people benefited from the arrival of the micro-turbine, and a similar project masterminded by Thaioil in Thailand’s Tak province, on the border with Burma, was endorsed by the UN. In this case, multiple sources of energy were used, including solar, bio and flowing water-generated energy.