Notes to the Financial Statements PTT Global Chemical Public Company Limited and its Subsidiaries Notes to the financial statements For the year ended 31 December 2023 36 The Company has an Ethane, Propane, LPG and NGL sales and purchase agreement with a parent company. Selling price in the agreement for Ethane is determined based on Polyethylene plastic pellets price. Selling price for Propane and LPG is determined based on Propane and Butane price in the world market and selling price for NGL is determined based on Naphtha price in the world market. The agreement is for the period of 11 years, commencing from the date as specified in the agreement and expiring in December 2030. The Company has an Ethane Rich Gas sales and purchase agreement with a related party. The selling price is determined based on Polyethylene plastic pellets, Olefins, and Propane price in the world market and Natural gas price in Thailand. The agreement is for the period of 9 years 7 months, commencing from the date as specified in the agreement and expiring in December 2030. The Company has an Ammonia sale and purchase agreement with a related party. Selling price is charged under the conditions as specified in the agreement. The agreement is for the period of 2 years, commencing from the date as specified in the agreement and will expire in December 2024. Petroleum Product Offtake Agreement The Company has a Petroleum Product sales and purchase agreement with a parent company and a related party. For domestic sales, the product price reflects prices prevailing in Thailand for products of a similar quality that are sold in or imported to Thailand. For export sales, the product price reflects the prevailing international spot price for that product. This agreement is for the period of 18 years, commencing from the date as specified in the agreement and expiring in February 2024. The agreement is automatically renewed except for advance cancellation through written notice by each party. Expansion Phase Product Offtake Agreement The Company has an expansion phase product offtake agreement with a parent company and a related party, underwhich a parent company and a related party agree to purchase 100% of the volume of refined petroleum products produce by reforming and upgrading complexes. As specified in the Product Offtake Agreement, at least 50% - 80% of such volume will be sold at a competitive domestic market price and the remaining sold at a competitive export market price or other mutually agreed price. The agreement is for the period of 18 years, commencing from the date as specified in the agreement and expiring in February 2024. The agreement is automatically renewed except for advance cancellation through written notice by each party. Long-term Crude Oil and Other Raw materials Supply Agreements The Company has entered into 2 supply agreements for crude oil and other raw materials with a parent company, the reference price being based on market price of crude oil and other raw materials. One agreement is for the period of 18 years, will expire in February 2024 and another agreement is for the period of 20 years, was automatically renewed and will expire in December 2024. These agreements are automatically renewed except for advance cancellation through written notice by each party. Crack Spread Swap Agreements The Company has entered into many crack spread swap agreements with a related party to hedge the Company’s oil refinery margin. The floating amount of the basket refinery margin (calculated crack spread based on the Singapore price of refined petroleum products, which are Naphtha, Gasoline, Gasoil, Kerosene and Fuel Oil, against the price of Dubai crude oil) is swapped for a fixed amount of the basket refinery margin for a fixed quantity per month. Under the agreements, the Company shall receive or make payment for the crack spread difference according to terms and conditions stipulated in the agreements. 280
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