Abstract
Inspired by the announcement of the liberalisation of the Thai Gas Industry in 1997, with the prime objective of improving efficiency in the energy sector, this thesis aims to assess the performance of the Petroleum Authority of Thailand (PTT)—a state-owned integrated gas monopoly in Thailand during 1984/85-1996/97. Given that PTT is a national integrated gas monopoly, an international comparison is required for evaluating the company’s performance. Therefore, in this thesis, PTT’s performance is compared to three other integrated gas companies operating in three different countries: Petronas, Osaka Gas and British Gas (operating in Malaysia, Japan and the UK, respectively). Data Envelopment Analysis (DEA) and Stochastic Frontier Analysis (SFA) are used to measure technical efficiency. Both are carried out under input and output orientations. Bootstrapping is also applied to the DEA to provide more statistical information. In addition, the change in PTT’s productivity over the estimation period is also estimated. The results show that in general PTT performed relatively well over the period; although this is due partially to the high concentration of gas utilisation, given the high proportion of gas consumed for power generation in Thailand. Some counter-factual experiments are undertaken to confirm the effect of the concentration of the gas market on PTT’s technical efficiency. There is also evidence of an improvement in productivity, due primarily to technical change. In sum, the results imply that despite the drop in technical efficiency at the end of the estimated period, PTT was already relatively efficient, even before the proposed changes by the Thai government. Nonetheless, given the high efficiency of PTT was partially influenced by the highly concentrated gas market, the result also provides a caution for PTT for future investment, if there is a shift in the pattern of gas utilisation towards the residential or commercial sector and the company would like to remain relatively efficient.