02 August 2007 05:24 [Source: ICIS news]
SINGAPORE (ICIS news)--Petrochemical Corp of Singapore (PCS) has switched to using naphtha feedstock at its cracker from July, owing to declines in the price of the traditional feedstock, a company source said on Thursday.
"We've switched to using 100% naphtha feedstock from July since naphtha prices have eased from recent highs. The economics can justify using naphtha fully," the source said.
The company, a 50:50 joint venture between Japan-Singapore Petrochemicals Co and Shell, switched up to 10% of its feedstock to gasoil in May following Asia naphtha's record-high prices this year.
Naphtha's rapid price rally to an all-time high of $741/tonne CFR (cost and freight) Japan in May had prompted several end-users in Japan, South Korea and Taiwan to switch a part of their cracker feedstock use to cheaper alternatives such as liquefied petroleum gas (LPG), butane and natural gas liquids (NGL).
But naphtha price in Asia has fallen below the $700/tonne mark this week to $673-676/tonne CFR (cost and freight) Japan, weighed down by healthy supplies from India.
"We will still continue to monitor the market situation. Any spike in naphtha prices can prompt us to switch some portions of our feedstock to using gasoil or LPG again," the source said.
PCS has two crackers at Jurong Island, with the No 2 cracker producing 615,000 tonnes/year ethylene and 320,000 tonnes/year propylene. The cracker has a new metathesis plant with a 200,000 tonnes/year of propylene capacity.
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