The price PTTGC will have to pay: Thai analysis

[webfact]

ANALYSIS
The price PTTGC will have to pay
Achara Deboonme,
Sanicha Lakhonphol
The Nation

BANGKOK: -- While PTT Global Chemical (PTTGC)'s share price does not yet fully reflect the cost of compensation and clean-up operations, there is little doubt the company will have to shoulder huge financial losses.

Five days since PTTGC's crude-oil pipeline leaked 50,000 litres of oil into the Gulf of Thailand, its share price has hardly moved as both authorities and stock analysts appear uncertain about the magnitude of the losses. Losing Bt0.75 on Monday and Bt3.25 on Tuesday, the stock lost another Bt4 on Wednesday, before gaining Bt3 yesterday to Bt69 - only 6.8 per cent lower than the price before the oil disaster. While authorities are busy with clean-up and rehabilitation plans, stock analysts are crunching the potential compensation figures.

In its research note, Kiatnakin stated that in the worst-case scenario, the company would face expenses from this incident that would just reach the equivalent of its 2013 earnings, estimated to be Bt35.7 billion. The financial burden resulting from the spill would be gradually realised from the third quarter onwards, it said. Though PTTGC stands to benefit from a recovery in the refining margin, a delay in insurance compensation could hit the oil giant's 2013 profits, it explained.

Based on the assumption that compensation will be calculated on financial losses over a year - ensuring protection of the fishing industry - Maybank Kim Eng Securities (Thailand) estimates that PTTGC would have to pay Bt4.9 billion for top insurance coverage - an equivalent of 14.4 per cent of the company's Bt34-billion earnings forecast.

In 2009, another PTT subsidiary was involved in the Montara oil spill, one of Australia's worst oil disasters, in the Timor Sea off western Australia. The volume of Saturday's oil spill is only 1 per cent of the Montara incident, so the clean-up cost is expected to be lower. However, with the oil slick reaching Koh Samet, compensation estimates are much higher and will be gradually realised from the third quarter onwards. Insurance compensation is also expected to be paid from the fourth quarter of this year to the first half of next year.

Trinity Securities said it expects PTTGC to shoulder above-insurance coverage costs of Bt3 billion-Bt5 billion, noting that the figures are moving higher due to the possibility of lawsuits from the government sector.

DBS Vickers Ballas Securities (Thailand) noted it was obvious that third-party liability insurance coverage of Bt1.5 billion would not be enough as the oil slick is shaving Bt2 billion-Bt2.5 billion off tourism revenue.

In a filing to the Stock Exchange of Thailand, PTTGC said that it had insurance coverage under Property Damage and Business Interruption, Marine Cargo, and Third Party Liability. PTTGC and its insurers are currently in the process of appraising the value of the claim.

While the first two insurance policies should cover expenses involved with the cleanup, the third would cover compensation claims, including those of business operators in Koh Samet.

According to Kiatnakin, the coverage of the Third Party Liability amounts to US$50 million or Bt1.56 billion. It remains to be seen if this will be enough, as a Rayong tourism operator said the oil slick was already washing ashore and scaring away tourists. As a result, the province may not be able to meet its annual revenue target of Bt20 billion this year.

The Marine Department plans to file a lawsuit. According to Marine Knowledge Hub's website (http://www.mkh.in.th), data from the department shows that during 1997-2010, nine severe incidents - with over 20,000 litres or 19.64 tonnes spilled - were recorded. By volume, PTTGC's incident - involving 49 tonnes - is smaller than some, but it is worth noting that other spills did not hurt tourist destinations.

In many ways, the PTTGC incident is a reminder of what BP witnessed in 2010, when its Deepwater Horizon oil rig in the Gulf of Mexico exploded - spilling out over 700,000 tonnes of oil. BP estimated oil spill costs of nearly $10 billion. With some of the oil also hitting the US Gulf Coast - which was estimated to generate $34 billion in revenue annually - BP had to strike a deal with the US government for a $20-billion compensation fund. However, by some estimates, the spill-related expenses could still exceed $50 billion.

The Pollution Control Department's data shows that compensation is compulsory for damage to living and non-living entities as well as the cost of rehabilitation. For example, any company responsible for an oil spill must pay Bt4,633 per annum for every square metre of coral reef destroyed, until the reef condition is restored. This is aside from the annual rehabilitation cost of Bt2,316. (http://marinepolicy.trf.or.th)

In two weeks, the dust should have settled. For now, though bullish on PTTGC's business prospects, brokerage houses admit that due to widespread negative news, investors looking for short-term gains should avoid this stock.


-- The Nation 2013-08-02

[NongKhaiKid]

The company's boss is being quoted as saying he couldn't understand where all the oil came from. He's the boss ?

[Mampara]

The company's boss is being quoted as saying he couldn't understand where all the oil came from. He's the boss ?

Thai Style.

[Tatsujin]

The price PTTGC will have to pay

No, the price we all have to pay . . . just wait . . . price increases at the pumps coming very soon to make up for their losses.

[geriatrickid]

The inadequacy of liability insurance is not unusual for Asia. My colleagues are always surprised when they are met with blank stares and "do not have" statements when the basic contracts state that a minimum of $10 million liability coverage is required. A chemical/oil conglomerate the size of PTT with less than a $50million limit speaks volumes.

Sadly, it will be the Thai people and the taxpayers who will indirectly assume the cost of the cleanup.

[ABCer]

I can understand that the only source of info 'The Nation' has is the disinformation coming from PTTGC and the stock exchange figures.

The Analysis they offer is based only on the factual information about the stock exchange share price movements and the above disinformation.

Further 'The Nation' mentions data from the Marine Department about 7 'severe' leaks in the 1997-2010 totaling to 20,000 LITERS of oil!

The naivety of the analysts can be only compared with the lie-ability of PTTGC. The motives of PTTGC are clear. But the analysts are supposed to think - by definition it is their job description.

Yet they all stick to their fib about 50,000 liters spill. Remarkable unity! It shows what can be achieved by a Nation when naivety is multiplied by lie-ability.

On the fourth day of floating the size of the spill shows 2,5 size of Koh Samet on a sat photo. 4 days of rain, sun, wind and high temp have 'boiled' out all the light (volatile) fractions of crude. What is showing on the sat picture is heavy oil!

It is sticky (highly viscose) and heavy. And the 'naturally occurring bacteria' don't like to eat it. I know. They told me. The problem is it finds very hard to form thin layers - you wouldn't be able to blow bubbles from it - and to float.

The rest is History hidden in Future: 30 square km of a heavy oil sleek = approx between 3,000 to 30,000 cubic meters of oil pumped out in the sea. PTTGC is not EXXON or BP but what they lack in size they make up in lies.

And it is understandable. This is their own waters. This is their own people. They have the right to tell them their own 'truth'. And they need no International Commissions to teach them how to keep their ugly faces clean - just shit in the Ocean!

You may ask, - how History gets hidden in Future? Easy. In about year 2020 a highly qualified Environment Conservation Expert from a Marine Department will find some more of black substance of unidentified nature in the layers of sand on the bottom of the Gulf of Thailand. His credentials will be duly Certified by a reputable Thai University Degree. Maybe even Chula? Maybe even a Ph D. Also it is possible that the level of occurrence of some nasty disease in Rayong, Trat or Pattaya will be found unusually and inexplicably high due to Farang or extraterrestrial hostile influences. But the profits of PTTGC by that time will be OK. No worries.

NOTE. I am not being ironic, caustic or sarcastic - look around you - this is life!

You always have a choice - do not believe me; believe them!

Accidents happen everywhere, except in Thailand!

I'm not bashing Thais for accident. I'm bashing Thais for their actions/inactions after the accident.

As per the advice of a ? Minister (?) - smell the fish!

Do Thais have an equivalent of FDA? If yes, - is it run by PTTGC ?

Edited August 2, 2013 by ABCer

[monkeycountry]

In other news, small restaurant owners are already telling how their usual fantastic sales figures of millions of baht a month, even during low season, have dropped to near zero. I hope the PTTGC guys are smart enough to request tax returns from these people to see their actual sales and profits from last year. In case they cheat and do not file tax returns, or file figures lower than the actual figures, then why should a government owned company compensate them? And even if they do go ahead and compensate, then what should the compensation amount be based on if not financial records?

I suggest the revenue department joins these negotiations, and have a close look at the claimant's tax records.

Edited August 2, 2013 by monkeycountry

[jackr]

^^ Yes, and you can bet your bottom dollar that one and all 'resorts' will have their hand out.

[Thai at Heart]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

Edited August 2, 2013 by Thai at Heart

[bigbamboo]

I can understand that the only source of info 'The Nation' has is the disinformation coming from PTTGC and the stock exchange figures.

The Analysis they offer is based only on the factual information about the stock exchange share price movements and the above disinformation.

Further 'The Nation' mentions data from the Marine Department about 7 'severe' leaks in the 1997-2010 totaling to 20,000 LITERS of oil!

The naivety of the analysts can be only compared with the lie-ability of PTTGC. The motives of PTTGC are clear. But the analysts are supposed to think - by definition it is their job description.

Yet they all stick to their fib about 50,000 liters spill. Remarkable unity! It shows what can be achieved by a Nation when naivety is multiplied by lie-ability.

On the fourth day of floating the size of the spill shows 2,5 size of Koh Samet on a sat photo. 4 days of rain, sun, wind and high temp have 'boiled' out all the light (volatile) fractions of crude. What is showing on the sat picture is heavy oil!

It is sticky (highly viscose) and heavy. And the 'naturally occurring bacteria' don't like to eat it. I know. They told me. The problem is it finds very hard to form thin layers - you wouldn't be able to blow bubbles from it - and to float.

The rest is History hidden in Future: 30 square km of a heavy oil sleek = approx between 3,000 to 30,000 cubic meters of oil pumped out in the sea. PTTGC is not EXXON or BP but what they lack in size they make up in lies.

And it is understandable. This is their own waters. This is their own people. They have the right to tell them their own 'truth'. And they need no International Commissions to teach them how to keep their ugly faces clean - just shit in the Ocean!

You may ask, - how History gets hidden in Future? Easy. In about year 2020 a highly qualified Environment Conservation Expert from a Marine Department will find some more of black substance of unidentified nature in the layers of sand on the bottom of the Gulf of Thailand. His credentials will be duly Certified by a reputable Thai University Degree. Maybe even Chula? Maybe even a Ph D. Also it is possible that the level of occurrence of some nasty disease in Rayong, Trat or Pattaya will be found unusually and inexplicably high due to Farang or extraterrestrial hostile influences. But the profits of PTTGC by that time will be OK. No worries.

NOTE. I am not being ironic, caustic or sarcastic - look around you - this is life!

You always have a choice - do not believe me; believe them!

Accidents happen everywhere, except in Thailand!

I'm not bashing Thais for accident. I'm bashing Thais for their actions/inactions after the accident.

As per the advice of a ? Minister (?) - smell the fish!

Do Thais have an equivalent of FDA? If yes, - is it run by PTTGC ?

PTT claims 50,000 litres of oil leaked into the sea. An Olympic size swimming pool holds 2,500,000 litres....... that's FIFTY times as much!

So how can anyone seriously believe PTT's figure?

Edited August 2, 2013 by bigbamboo

[Brian67]

PTT headquarters live......http://youtu.be/2AAa0gd7ClM

[monkeycountry]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

I hope you are right, but I think the main reasons the smaller businesses will settle out of court will be 1) they do not wan't to pay for a lawyer, and 2) they know that they will "lose" in court, as few of them have any financial records to prove their revenue and profit. On the contrary, the few tax returns they do have most likely show little revenue and no profit in order to avoid taxes. Som Nam Na!

As mentioned above, I hope the PTTGC guys are aware of this, and simply tell everyone to accept a reasonable compensation amount or take their fantasy claims to court - where their tax fraud will be esposed. They should not even spend 5 minutes listening to all the silly fantasies about restaurants packed with lobster eating rich customers all day long during low season, or the expected 800% increase in tourism this year, which is now not going to happen etc.

Edited August 2, 2013 by monkeycountry

[Soutpeel]

The inadequacy of liability insurance is not unusual for Asia. My colleagues are always surprised when they are met with blank stares and "do not have" statements when the basic contracts state that a minimum of $10 million liability coverage is required. A chemical/oil conglomerate the size of PTT with less than a $50million limit speaks volumes.

Sadly, it will be the Thai people and the taxpayers who will indirectly assume the cost of the cleanup

The US $50 million liablity coverage is pretty much an international norm and if the memory serves the number comes from one of the offshore "continential shelf agreements" so this is not "usual for Asia" it seems to me they are in line with what happens internationally.

[Thai at Heart]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

I hope you are right, but I think the main reasons the smaller businesses will settle out of court will be 1) they do not wan't to pay for a lawyer, and 2) they know that they will "lose" in court, as few of them have any financial records to prove their revenue and profit. On the contrary, the few tax returns they do have most likely show little revenue and no profit in order to avoid taxes. Som Nam Na!

As mentioned above, I hope the PTTGC guys are aware of this, and simply tell everyone to accept a reasonable compensation amount or take their fantasy claims to court - where their tax fraud will be esposed. They should not even spend 5 minutes listening to all the silly fantasies about restaurants packed with lobster eating rich customers all day long during low season, or the expected 800% increase in tourism this year, which is now not going to happen etc.

Hey, I don't look at it like that. They damaged an island and have done financial damage to people. Fishing and other things will be paying the price for this for a long time. PTT should pay.

[Thai at Heart]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

I hope you are right, but I think the main reasons the smaller businesses will settle out of court will be 1) they do not wan't to pay for a lawyer, and 2) they know that they will "lose" in court, as few of them have any financial records to prove their revenue and profit. On the contrary, the few tax returns they do have most likely show little revenue and no profit in order to avoid taxes. Som Nam Na!

As mentioned above, I hope the PTTGC guys are aware of this, and simply tell everyone to accept a reasonable compensation amount or take their fantasy claims to court - where their tax fraud will be esposed. They should not even spend 5 minutes listening to all the silly fantasies about restaurants packed with lobster eating rich customers all day long during low season, or the expected 800% increase in tourism this year, which is now not going to happen etc.

Hey, I don't look at it like that. They damaged an island and have done financial damage to people. Fishing and other things will be paying the price for this for a long time. PTT should pay, irrespective of whether these businesses are completely legal or not. But it of course hilights the problems with liability litigation in this country. The big boys NEVER pay.

[Thai at Heart]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

I hope you are right, but I think the main reasons the smaller businesses will settle out of court will be 1) they do not wan't to pay for a lawyer, and 2) they know that they will "lose" in court, as few of them have any financial records to prove their revenue and profit. On the contrary, the few tax returns they do have most likely show little revenue and no profit in order to avoid taxes. Som Nam Na!

As mentioned above, I hope the PTTGC guys are aware of this, and simply tell everyone to accept a reasonable compensation amount or take their fantasy claims to court - where their tax fraud will be esposed. They should not even spend 5 minutes listening to all the silly fantasies about restaurants packed with lobster eating rich customers all day long during low season, or the expected 800% increase in tourism this year, which is now not going to happen etc.

Hey, I don't look at it like that. They damaged an island and have done financial damage to people. Fishing and other things will be paying the price for this for a long time. PTT should pay, irrespective of whether these businesses are completely legal or not. But it of course hilights the problems with liability litigation in this country. The big boys NEVER pay.

[morpho]

I'd like to know how much money changes hands under the table on this one!!!

[Thai at Heart]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

I hope you are right, but I think the main reasons the smaller businesses will settle out of court will be 1) they do not wan't to pay for a lawyer, and 2) they know that they will "lose" in court, as few of them have any financial records to prove their revenue and profit. On the contrary, the few tax returns they do have most likely show little revenue and no profit in order to avoid taxes. Som Nam Na!

As mentioned above, I hope the PTTGC guys are aware of this, and simply tell everyone to accept a reasonable compensation amount or take their fantasy claims to court - where their tax fraud will be esposed. They should not even spend 5 minutes listening to all the silly fantasies about restaurants packed with lobster eating rich customers all day long during low season, or the expected 800% increase in tourism this year, which is now not going to happen etc.

Hey, I don't look at it like that. They damaged an island and have done financial damage to people. Fishing and other things will be paying the price for this for a long time. PTT should pay, irrespective of whether these businesses are completely legal or not. But it of course hilights the problems with liability litigation in this country. The big boys NEVER pay.

[tx22cb]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

I hope you are right, but I think the main reasons the smaller businesses will settle out of court will be 1) they do not wan't to pay for a lawyer, and 2) they know that they will "lose" in court, as few of them have any financial records to prove their revenue and profit. On the contrary, the few tax returns they do have most likely show little revenue and no profit in order to avoid taxes. Som Nam Na!

As mentioned above, I hope the PTTGC guys are aware of this, and simply tell everyone to accept a reasonable compensation amount or take their fantasy claims to court - where their tax fraud will be esposed. They should not even spend 5 minutes listening to all the silly fantasies about restaurants packed with lobster eating rich customers all day long during low season, or the expected 800% increase in tourism this year, which is now not going to happen etc.

Whilst I agree with your legal assessment (which is correct in law), the court of public opinion will flay PTTGC (and PTT) if they use those arguments (illegal businesses, understatement of income taxes) to wriggle out of reasonable compensation. This situation is no longer a scientific problem (how to clean up and remediate) nor is it a legal one, but it is a much more critical crisis of Reputation resuscitation. And PTTGC cannot expect any respite from the Govt officials either.

[tx22cb]

<<double post>>

Edited August 2, 2013 by tx22cb

[Wavefloater]

The price PTTGC will have to pay

No, the price we all have to pay . . . just wait . . . price increases at the pumps coming very soon to make up for their losses.

Well, PTT won't be able jack their prices up and ask for 2-3 baht more per liter than Caltex and other competitors. Blatant price fixing has existed in the oil industry for decades, so when the bosses of each company get together to collude and figure out more ways to screw us out of our paychecks, they'll agree on how to all profit more from PTT's blunder.

[Wavefloater]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

I hope you are right, but I think the main reasons the smaller businesses will settle out of court will be 1) they do not wan't to pay for a lawyer, and 2) they know that they will "lose" in court, as few of them have any financial records to prove their revenue and profit. On the contrary, the few tax returns they do have most likely show little revenue and no profit in order to avoid taxes. Som Nam Na!

As mentioned above, I hope the PTTGC guys are aware of this, and simply tell everyone to accept a reasonable compensation amount or take their fantasy claims to court - where their tax fraud will be esposed. They should not even spend 5 minutes listening to all the silly fantasies about restaurants packed with lobster eating rich customers all day long during low season, or the expected 800% increase in tourism this year, which is now not going to happen etc.

It's funny what a difference a single hyphen (-) can make. When I was reading this, I came across "restaurants packed with lobster eating rich customers all day long" and a picture of lobsters eating wealthy people came to mind, whereas "restaurants packed with lobster-eating rich customers all day long" gives me the opposite picture -- one of wealthy people eating lobster. Of course, the hyphen changes the word 'eating' from verb to an adjective.

(Hope you see the humour, monkeycountry, and realize that I'm not ridiculing you or insulting your use of language. Just pointing out a peculiarity of English.

[monkeycountry]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

I hope you are right, but I think the main reasons the smaller businesses will settle out of court will be 1) they do not wan't to pay for a lawyer, and 2) they know that they will "lose" in court, as few of them have any financial records to prove their revenue and profit. On the contrary, the few tax returns they do have most likely show little revenue and no profit in order to avoid taxes. Som Nam Na!

As mentioned above, I hope the PTTGC guys are aware of this, and simply tell everyone to accept a reasonable compensation amount or take their fantasy claims to court - where their tax fraud will be esposed. They should not even spend 5 minutes listening to all the silly fantasies about restaurants packed with lobster eating rich customers all day long during low season, or the expected 800% increase in tourism this year, which is now not going to happen etc.

It's funny what a difference a single hyphen (-) can make. When I was reading this, I came across "restaurants packed with lobster eating rich customers all day long" and a picture of lobsters eating wealthy people came to mind, whereas "restaurants packed with lobster-eating rich customers all day long" gives me the opposite picture -- one of wealthy people eating lobster. Of course, the hyphen changes the word 'eating' from verb to an adjective.

(Hope you see the humour, monkeycountry, and realize that I'm not ridiculing you or insulting your use of language. Just pointing out a peculiarity of English.

Upon reading my own sentence again, I completely see what you mean

[mca]

The volume of Saturday's oil spill is only 1 per cent of the Montara incident, so the clean-up cost is expected to be lower.

Bloody hell I nearly fell off my chair at that revelation

[monkeycountry]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

I hope you are right, but I think the main reasons the smaller businesses will settle out of court will be 1) they do not wan't to pay for a lawyer, and 2) they know that they will "lose" in court, as few of them have any financial records to prove their revenue and profit. On the contrary, the few tax returns they do have most likely show little revenue and no profit in order to avoid taxes. Som Nam Na!

As mentioned above, I hope the PTTGC guys are aware of this, and simply tell everyone to accept a reasonable compensation amount or take their fantasy claims to court - where their tax fraud will be esposed. They should not even spend 5 minutes listening to all the silly fantasies about restaurants packed with lobster eating rich customers all day long during low season, or the expected 800% increase in tourism this year, which is now not going to happen etc.

Hey, I don't look at it like that. They damaged an island and have done financial damage to people. Fishing and other things will be paying the price for this for a long time. PTT should pay, irrespective of whether these businesses are completely legal or not. But it of course hilights the problems with liability litigation in this country. The big boys NEVER pay.

I agree that PTTGC should pay of course. But they should pay the actual damages, not damages invented by opportunists who are most likely not only trying to cheat PTTGC, but also cheat the rev. dept. and thereby all of us on a daily basis. Therefore PTTGC and the government should calculate their own reasonable figures for settlement, and forget about all the fantastic revenue and profit figures I have read about in related news. If people are not happy with the settlement offered, then they always have the option to go to court, where the legal operators will eventually win as they have evidence of their success, and the illegal ones will lose due to lack of evidence of their success.

Just like with insurance claims, damage claims should only be based on proven success (ie. past records), not on future dreams of success.

Further, I feel sorry for the fish, but having seen the garbage the fishing industry is constantly dumping on the beaches combined with their overfishing, I think the fishing industry does alot more damage both to the fishing industry and to the tourism industry, than the PTTGC has ever done.

Edited August 2, 2013 by monkeycountry

[Thai at Heart]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

I hope you are right, but I think the main reasons the smaller businesses will settle out of court will be 1) they do not wan't to pay for a lawyer, and 2) they know that they will "lose" in court, as few of them have any financial records to prove their revenue and profit. On the contrary, the few tax returns they do have most likely show little revenue and no profit in order to avoid taxes. Som Nam Na!

As mentioned above, I hope the PTTGC guys are aware of this, and simply tell everyone to accept a reasonable compensation amount or take their fantasy claims to court - where their tax fraud will be esposed. They should not even spend 5 minutes listening to all the silly fantasies about restaurants packed with lobster eating rich customers all day long during low season, or the expected 800% increase in tourism this year, which is now not going to happen etc.

Hey, I don't look at it like that. They damaged an island and have done financial damage to people. Fishing and other things will be paying the price for this for a long time. PTT should pay, irrespective of whether these businesses are completely legal or not. But it of course hilights the problems with liability litigation in this country. The big boys NEVER pay.

I agree that PTTGC should pay of course. But they should pay the actual damages, not damages invented by opportunists who are most likely not only trying to cheat PTTGC, but also cheat the rev. dept. and thereby all of us on a daily basis. Therefore PTTGC and the government should calculate their own reasonable figures for settlement, and forget about all the fantastic revenue and profit figures I have read about in related news. If people are not happy with the settlement offered, then they always have the option to go to court, where the legal operators will eventually win as they have evidence of their success, and the illegal ones will lose due to lack of evidence of their success.

Just like with insurance claims, damage claims should only be based on proven success (ie. past records), not on future dreams of success.

Further, I feel sorry for the fish, but having seen the garbage the fishing industry is constantly dumping on the beaches combined with their overfishing, I think the fishing industry does alot more damage both to the fishing industry and to the tourism industry, than the PTTGC has ever done.

How big should the compensation be if the tourism numbers are 50% down for the whole island next year? It won't matter because it will all be settled by then.

[monkeycountry]

How big should the compensation be if the tourism numbers are 50% down for the whole island next year? It won't matter because it will all be settled by then.

First of all, it won't be. Most foreign tourists who arrive next year, or even next month, won't even know that there was a problem. Unless perhaps they decide to go to the tiny beach in question if it is not clean by then. In fact according to people on the island commenting on TV, many tourist who are there right now are not even aware of the problem.

Anyway, IF tourism is down by 50% next year due to this, then they should of course be compensated for that. But again, with a reasonable amount. Remember, when revenue is down, so are expenses, although not by the same percentage. As an example, a restaurant with few customers needs to buy less food than a full restaurant, but still need to pay rent and staff.

People can't expect damage payment in advance for what may or may not happen in the future. If they want money now, it should be based on already incurred losses. Future losses should be compensated later once the amount is known or can be reasonably predicted. Right now it is simply anyones guess.

[monkeycountry]

The resorts will settle for a pittance out of court, because to sue, would tie them up in knots for years until PTT pays out. There will be no million dollar pay outs from PTT. Beyond that, isn't it a national park. What are all those developments doing there anyway? How does one get a license for an illegal business inside a national park.

Maybe that PTT pays zilch if that is the case.

I hope you are right, but I think the main reasons the smaller businesses will settle out of court will be 1) they do not wan't to pay for a lawyer, and 2) they know that they will "lose" in court, as few of them have any financial records to prove their revenue and profit. On the contrary, the few tax returns they do have most likely show little revenue and no profit in order to avoid taxes. Som Nam Na!

As mentioned above, I hope the PTTGC guys are aware of this, and simply tell everyone to accept a reasonable compensation amount or take their fantasy claims to court - where their tax fraud will be esposed. They should not even spend 5 minutes listening to all the silly fantasies about restaurants packed with lobster eating rich customers all day long during low season, or the expected 800% increase in tourism this year, which is now not going to happen etc.

Whilst I agree with your legal assessment (which is correct in law), the court of public opinion will flay PTTGC (and PTT) if they use those arguments (illegal businesses, understatement of income taxes) to wriggle out of reasonable compensation. This situation is no longer a scientific problem (how to clean up and remediate) nor is it a legal one, but it is a much more critical crisis of Reputation resuscitation. And PTTGC cannot expect any respite from the Govt officials either.

The public will not use more or less gasoline nor worry about where they buy it, no matter how PTT behaves in this case. PTT is almost (but not quite) like the water and electric companies - you may not like them, but you still need their services. Obviously PTT will not use my arguments as bluntly as I have, but they can, and probably will, still use them in a more discrete way if things went to court. However, the PTP government, who owns most of PTT's shares, does need public support (and they clearly don't mind paying for populist policies), so there is a chance/risk that they will directly or indirectly force PTT to pay more than they would have otherwise.

Edited August 2, 2013 by monkeycountry

[Thai at Heart]

How big should the compensation be if the tourism numbers are 50% down for the whole island next year? It won't matter because it will all be settled by then.

First of all, it won't be. Most foreign tourists who arrive next year, or even next month, won't even know that there was a problem. Unless perhaps they decide to go to the tiny beach in question if it is not clean by then. In fact according to people on the island commenting on TV, many tourist who are there right now are not even aware of the problem.

Anyway, IF tourism is down by 50% next year due to this, then they should of course be compensated for that. But again, with a reasonable amount. Remember, when revenue is down, so are expenses, although not by the same percentage. As an example, a restaurant with few customers needs to buy less food than a full restaurant, but still need to pay rent and staff.

People can't expect damage payment in advance for what may or may not happen in the future. If they want money now, it should be based on already incurred losses. Future losses should be compensated later once the amount is known or can be reasonably predicted. Right now it is simply anyones guess.

Just wait. The slick is still pretty damn big. I saw in the TV this morning, they are already starting to get tiny hard pellets of tar coming up on the mainland beach. If it gets to land, the mainland beaches are going to take a whack, and there are a lot of foreign and domestic tourists who do go down there. At the end of the day, they will have to work very hard with their marketing to get people to go back to the same level.

I would predict, that with the way they have handled this, they are likely to be having tar balls washing up on the mainland and parts of the islands for aquite a while. They should still be out there skimming and booming off as much of the remaining oil as they can possibly get hold of. Now I don't know about you, but that entire stretch of beach down there was always absolutely filthy, but people seemed to put up with it. If tar balls start washing up on the beach, you can bet a lot of people will stay away.

[biplanebluey]

The volume of Saturday's oil spill is only 1 per cent of the Montara incident, so the clean-up cost is expected to be lower.

Bloody hell I nearly fell off my chair at that revelation

YEA-----I wonder how long it took someone to work that one out "expected to be lower----WOW"