Banpu unveils ‘greener & smarter’ strategy after record-breaking 2022
Banpu, Thailand's leading energy provider, has unveiled what it calls a strategic shift to non-gas-based businesses with a portfolio of renewable energy, clean technology, and one-stop green energy service solutions.
Banpu CEO Somruedee Chaimongkol said on Wednesday that the company will focus 60% of its efforts on energy technology, renewable energy, and beyond, and 40% on gas-fired power generation.
She said the change was part of Banpu’s greener and smarter strategy for 2023-2025, which established key directions for its three core business groups: Energy resources, energy generation (coal mining and gas), and energy technology.
"The mining group will focus on boosting production efficiency to deliver high-quality products, as well as research in businesses with high growth potential such as strategic minerals [copper, nickel, and gold]," she said.
Banpu currently mines coal in Indonesia, Australia, and China.
Somruedee underlined the importance of maintaining industry leadership in natural gas production in the US market, as well as looking for new opportunities in new businesses that strengthen and complement existing ones.
The company said it is also working on carbon capture and sequestration projects and taking concrete steps to achieve Net Zero by the end of 2025.
On energy generation, Somruedee said Banpu will maximise value and efficiency of its thermal power generation business to generate consistent cash flow, while also seeking new investment opportunities in high-growth renewable power generation sectors such as solar farms, solar rooftop, and wind power.
Banpu will focus on increasing value across the US electricity value chain, including electricity retail and trading capabilities in merchant markets, as well as investment opportunities in new High Efficiency, Low Emissions (HELE) power plants.
Banpu operates energy generation projects in eight countries across the Pacific Rim with total capacity of 4,264 megawatts.
The company will also expand its portfolio in target areas such as battery, e-mobility, applications, healthcare, and battery recycling, she said.
Somruedee noted that Banpu had invested US$70 million in February to raise its shareholding in Durapower Holdings Pte Ltd (Durapower) from 47.68% to 65.10% to scale up its battery business, a key mechanism connecting Banpu’s business ecosystem.
The strategy shift comes as the company enters its 40th year and after reporting a strong performance in 2022 driven by rising global commodity prices and full production capacity in energy generation projects in China and the United States.
Total sales revenue rose 87% year on year to $7.693 billion.
Meanwhile, earnings before interest, taxes, depreciation, and amortisation were $3.916 billion, up 120% from the previous year. Net profit rose 282% to $1.162 billion.
Somruedee hailed 2022 as a record-breaking year for Banpu, with net profit tripling from 2021.
“The remarkable result was driven not only by the upside from high energy prices, but also our focus on agile and flexible operations in all business units, as well as our extensive efforts in accelerating business expansion in line with the greener & smarter strategy over the recent years.”
Asked about this year's revenue projection, Somreudee said she couldn't say right now because it depends on commodity prices. However, she said Banpu’s 2023 production capacity would definitely exceed last year's.
