Prasert Bunsumpun, PTT's president, said although the organisation had not yet separated its pipeline business, which is worth more than Bt100 billion, there had been no effect on consumers because the pipelines did not affect its administration and transmission fees. He promised that the business would be pealed off this year

Earlier, consumer groups accused PTT of failing to follow through on its promises in the prospectus because the petroleum company had yet to separate the gas pipeline to enable other power producers to compete fairly and use the PTT network.

During yesterday's two-hour press conference, Prasert insisted the PTT privatisation process was transparent in spite of allegations that the share allocation served only a small group of politicians.

"It didn't serve any particular group," he said. "The privatisation of PTT was not the sale of national assets but a plan to add to the value and security of those assets. The agency can stand on its own and no longer has to be a burden for the country."

He said PTT had not separated its pipeline since the privatisation, because the nature of the electricity business had been transformed from a state-run monopoly to a fragmented system of independent suppliers.

PTT executives said they no longer wanted to argue over this issue and would proceed with the separation immediately to end the public scepticism over the PTT privatisation, Prasert said.

Speculation has been running high that PTT would be the

next target of anti-privatisation activists after the Supreme

 Administrative Court blocked the Egat Plc plan to sell its shares on the stock market.

Consumer groups said they planned to file a case with the administrative court to reverse the PTT privatisation. The separation of the pipeline business was one of several allegations made by the campaigners who accused PTT of failing to honour its pre-initial-public-offering promises.

Prasert said the separation of the pipeline unit would not change the administrative or transmission fees because the state agencies would continue to oversee those fees.

He added that he had consulted legal experts and relevant parties about the privatisation and was confident that the PTT sell-off was done according to the law.

The listing of PTT was not the sale of national assets because the government still held a combined 68 per cent of PTT shares, directly and indirectly, Prasert said.

Around 52.5 per cent of these are controlled through the Finance Ministry and 15.6 per cent via the Vayupak Fund I.

Moreover, the Finance Ministry is entitled to buy back PTT shares from the Vayupak Fund.

He said the PTT privatisation had increased the value of the nation's assets by almost Bt500 billion.

The PTT initial public offering (IPO) price of Bt35 a share was reasonable, he said, countering criticism that the IPO price was set low for the benefit of people who were entitled to receive PTT shares at the offering price. He said that the price was calculated based on sentiment at that time, which was affected by the World Trade Centre attack on September 11, 2001.

Prasert insisted that PTT's privatisation had helped maintain the Thai ownership of companies such as Thai Oil and the Rayong refinery, which might otherwise have fallen into the hands of foreign businesses such as Chase Manhattan or JP Morgan.

Meanwhile, Energy Minister Viset Choopiban said on the separation of PTT from its gas pipeline business: "We may not see the immediate opportunity for third parties in the initial stages because the PTT already has a number of advance contracts with users. The picture should become clearer after the completion of the third pipeline's construction, part of which will be finished this year, and the discovery of fresh gas resources. Then, third parties can participate in the pipeline transmission service. It will take some years to see that happen."

PTT will have to discuss with the Finance Ministry whether it can receive an exemption from taxes incurred from the transfer of PTT assets to a future company. But if the taxes cannot be avoided, Viset said PTT would be capable of paying.

Watcharapong Thongrung

The Nation