Thailand to decide on second cracker site by '07

02 September 2005 06:45  [Source: ICIS news]

BANGKOK (ICIS news)--The Thai government will decide within the next two years whether to locate a new cracker complex in southern part of the country, an official source told ICIS news on Friday.

Mab Ta Phut, the country’s existing petrochemical hub along the eastern sea-board, will be chosen only if an oil pipeline project in the South does not go ahead, he added.

The plan is for a pipeline from the Gulf of Thailand at the Andaman Sea to Phang Nga province on the southeast. Oil tankers from the Middle-East would berth on the Andaman Sea coast, where a refinery is being planned, and discharge their cargoes with vessels waiting at other end for onward shipment. A naphtha cracker complex is also being planned. The targeted start-up date for the pipeline is 2012, the refinery 2013 and the cracker complex 2014-15.

If the pipeline does not go ahead and Mab Ta Phut is instead chosen, an ethane-based cracker would be built instead within the next decade with the site expanded to provide the necessary land.

The plans are part of the country’s third petrochemical master plan, which is due to be put before the Thai cabinet later in 2005. The first two plans saw construction of Thailand’s current capacity, which includes crackers operated by National Petrochemical Co and Thai Olefins Co at Mab Ta Phut.

The 291-kilometre pipeline is an attempt to break the dependence on the Straits of Malacca for crude-oil shipments. The only route to get Middle-East crude oil to ports in eastern Thailand and beyond is via the Straits, where piracy is a major threat to shipping.

"Also, if war occurred in this region the Straits could be closed down, cutting off crude supply to much of Asia," said the said.

Several Chinese and Japanese companies are interested in investing in the project, and a feasibility study is being conducted into the proposed pipeline, he added.

ICIS news had earlier been told that Chinese major PetroChina had expressed interest in investing in the cracker project, provided it was located in southern Thailand. The source reiterated that the company remained interested in the proposed cracker, as it would be cost-effectively located for exports to China.

By: John Richardson
+65 6780 4359

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