Oil Fund for mass transit

Business News - Saturday December 22, 2007

INFRASTRUCTURE

Oil Fund for mass transit

YUTHANA PRAIWAN

The government will shift proceeds of 0.50 baht a litre in fuel levies collected by the state Oil Fund to the Energy Conservation Fund in order to finance the construction of mass-transit projects, Energy Minister Piyasvasti Amranand said yesterday.

Currently, the Energy Conservation Fund receives 0.18 baht a litre on all motor fuel sales, and the additional Oil Fund contribution would bring the total to 0.68 baht.

The conservation fund as a result will gain more than one billion baht a month, which will be placed in a special account to fund Bangkok mass-transit lines and a nationwide double-track rail system.

Both the Oil Fund and the Energy Conservation Fund will need to set aside a total of 10 billion baht as a reserve for emergency use if petroleum or biofuel supplies are tight.

The Oil Fund has almost paid off all of the 92 billion baht in debts it ran up from subsidising retail fuel prices under the Thaksin Shinawatra government. As of yesterday, only 61 million baht remained.

Once it free of debt, the Oil Fund will have cash flow estimated at 4.156 billion baht a month, compared with 2.23 billion baht a month at present.

The fund currently collects four baht a litre on sales of premium petrol, 3.30 baht on regular petrol, 0.30 baht on E10 gasohol and 0.70 baht on high-speed diesel.

It also subsidises E10 gasohol at 0.20 baht a litre and B5 diesel at 0.10 baht.

Bangkok Post