CPDC is still keen on China projects

14 October 2002 00:00  [Source: ACN]

China Petrochemical Development Corp (CPDC) is still keen to pursue projects in China either as an alternative or in addition to some of its expansion ambitions for Taiwan, an industry source told ACN.

The Taiwanese major is currently evaluating the addition of a further 80 000 tonne/year of acrylonitrile capacity in Taiwan (ACN 7-13 Oct, p35).

The company is also planning to raise its acetic acid capacity (see above).

Like many Taiwanese petrochemical players, CPDC has witnessed the relocation of an increasing number of end-users to the mainland.

For instance, it estimates that 30-40% of nylon fibre and nylon filament producers that its nylon chip customers supply have shifted to China.

As a result, despite its decision in August 1999 to drop out of acrylonitrile, acrylic fibre, ABS, ammonia and methanol projects in China, the company is still investigating the possibility of investments on the mainland.

One product CPDC is still keen to produce on the mainland is ABS, said the source.

He added that mainland investments could be wholly owned, with a local partner and/or through a consortium of Taiwanese investors.

However, lack of finance, one of the reasons why CPDC earlier dropped its China projects, remains an issue.

The closure of a non-worldscale 60 000 tonne/year caprolactam plant at Kaohsiung last year has helped reduce CPDC's costs. All 180 workers at the plant were laid off.

Nevertheless, the company still has a total debt of NT$25bn (US$714.3m) and admits that it is in need of a capital injection.

Much of the debt is down to its 135 000 tonne/year worldscale caprolactam plant, also at Kaohsiung, which it brought onstream in May 2000.

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