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UPDATE 2-Thailand's PTT to expand in retail, power to weather slower global growth

Florence Tan

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* Seeking approvals for retail unit IPO

* Subsidiaries need to consolidate upstream, power acquisitions

* To invest in Myanmar oil, LPG terminal (Adds upstream investments)

KUALA LUMPUR, June 24 (Reuters) - Thailand's largest energy firm PTT Pcl has stepped up investments in the retail and industrial power sectors as a buffer against the impact of a global economic slowdown on its oil refining and chemical businesses, its CEO said on Monday.

"We have a global challenge and that is the (U.S.-China) trade war. That is one of our challenges - how can we survive in the short term?" PTT's President and Chief Executive Officer Chansin Treenuchagron told Reuters.

Asia's oil and petrochemical producers are facing thin profit margins as fuel and chemical supply exceeds demand amid new production plants starting up, while global demand growth has slowed amid the trade war between the United States and China, the world's two largest oil consumers.

The International Energy Agency has revised down its 2019 oil demand growth estimate by 100,000 barrels to 1.2 million barrels per day due to the worsening prospects for world trade, although stimulus packages and developing countries should boost growth going into 2020.

"We look at continued improvement in the short term. How can we sell at lower costs? How can we find another income that doesn't depend on oil and petrochemicals?," Chansin said.

One way to create more income would be expanding its retail business, he added, including expanding its Cafe Amazon brand of coffee shops across Asia.

PTT is planning an initial public offering (IPO) for PTT Oil & Retail Co (PTTOR) on the Stock Exchange of Thailand, the sixth company to be listed under the PTT group.

PTTOR, which includes gas stations, Cafe Amazon cafes and convenience stores, is expected to kick off its IPO process later this year which could raise about $2 billion.

PTT is seeking approvals from shareholders, its board of directors and the local securities authority for the IPO, Chansin said, but declined to say how much the company planned to raise.

The retail unit's "market is not only in Thailand anymore, and we want to expand in Indochina and in other Asian countries," he said on the sidelines of the Asia Oil and Gas Conference.

PTTOR also plans to build an oil and liquefied petroleum gas (LPG) import terminal near Thilawat in Myanmar with the Kanbawza Group, Chansin said.

In addition, PTT is expanding its utility subsidiary Global Power Synergy (GPSC) which focuses on providing power to industries, Chansin said.

GPSC is also pursuing a gas-to-power project in Myanmar, he said. The company has boosted its power-generating assets through acquisitions of a power project from PTT subsidiary Thai Oil Pcl, and the purchase of Glow Energy Pcl from France's Engie SA which has more than doubled GPSC's power-generation capacity.

Last week, PTT also increased its investment spending plan for 2019 by 47% to 103.70 billion baht to support its subsidiaries' expansion into electricity and renewable energy.

UPSTREAM

Another subsidiary - PTT Exploration and Production Pcl - has been on an acquisition spree, securing concessions for the Erawan and Bongkot gas fields in the gulf of Thailand, buying Murphy Oil Corp's Malaysian oil and gas assets and Partex Holding B.V..

"We have had three big M&A projects already," Chansin said.

"When you eat too much and too fast, you cannot digest ... We need to cultivate something first and not go too fast," he added.

The latest acquisition, Partex, produces 16,000 barrels of oil equivalent per day (boed) in oil and gas fields in Oman, the United Arab Emirates and Kazakhstan.

PTT's focus is mainly in natural gas, Chansin said, and it wants to focus on the Middle East, so it may sell non-Middle East assets after acquiring Partex.

(Reporting by Florence Tan; additional reporting by Chayut Setboonsarng in BANGKOK; Editing by Christian Schmollinger and Mark Potter)