Siam Cement, Dow near cracker complex approval

11 February 2008 08:21  [Source: ICIS news]

SINGAPORE (ICIS news)--Siam Cement and Dow Chemical have secured “nearly all approvals” for their new joint-venture 900,000 tonne/year cracker project in Mab Ta Phut, Thailand, said Noel Williams, Dow’s president for Asean, Australia and New Zealand.


The complex was on track to start up in the second half of 2010, he added.


Williams was responding to concerns that the timing of the project could be affected by a recent dispute between Mab Ta Phut residents and government officials over environmental concerns.


Only last October, there were reports that a proposed lawsuit would, if successful, turn the site into a “pollution-control” zone. This would prevent new petrochemical plants from being built.


But Williams said environmental concerns were being addressed and that Siam Cement/Dow had already started piling work on their new complex, which would include the new naphtha cracker.


Eighty five percent of the naphtha for the cracker will be imported, leading some commentators to question the economics of the project.


Williams said that a value-added downstream slate - including propylene oxide (PO) and specialty elastomers - would help ensure competitiveness.


The new Thai complex would also benefit from construction costs much lower than in the Middle East, he added.


“Building costs in the Middle East can be 50% higher than in Asia,” he said.


Last month, Siam Cement and Dow said they were in the final stages of planning for a specialty elastomers plant that would produce AFFINITY Polyolefin Plastomers and ENGAGE Polyolefin Elastomers. The polymers are used in packaging and automotive thermoplastic applications.


Kuwait’s Petrochemical Industries Co (PIC) would not necessarily supply feedstock for the cracker through its parent company Kuwait Petroleum Co, Williams said.


The companies had signed a memorandum of understanding for a $19bn olefins and polymers joint venture last December. The proposed deal was scheduled to be completed by the end of 2008.


However, he added a Dow/PIC tie-up would strengthen feedstock integration in general.


This is the first in a special series of stories we will be running ahead of the Asia Petrochemical Industry Conference (APIC) which takes place in Singapore on 27-28 May – Asia’s equivalent of NPRA and EPCA and therefore a key event for your calendar. The series will feature interviews with key industry figures and industry associations.

By: John Richardson
+65 6780 4359

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