S Korea’s Honam to finish studies for SE Asia complex by early 2013

09 February 2012 08:40  [Source: ICIS news]

SINGAPORE (ICIS)--Honam Petrochemical is expected to finish feasibility studies for a new petrochemical complex in southeast Asia by early 2013, with Indonesia as the most likely location for the $4-5bn (€3-4bn) project, company sources said on Thursday.

Honam has “highly prioritised” Indonesia as the site for the project, but no firm decisions have been made, a company official said.

The official was responding to queries regarding a news report on Thursday quoting the firm’s senior managing director of business development, Kim Gyo-hyun, as saying that the company has selected a site at Cilegon in Indonesia for the new integrated complex.

Honam’s plans for the complex at Cilegon in Banten province include a 1m tonne/year cracker, which will source its naphtha feedstock from domestic partners “where possible” and through imports, according to the report by Indonesia’s The Jakarta Post on Thursday.

In addition, the complex will include a 550,000 tonne/year propylene unit and a 700,000 tonne/year monoethylene glycol (MEG) plant, the report said.

The output from the new complex will mostly serve the domestic market, The Jakarta Post quoted Kim as saying.

Company sources that ICIS spoke with declined to verify the details in the report.

Feasibility studies for the project are ongoing and the company has not decided on the configurations of the new complex, which will likely include a cracker and other downstream units, the Honam official said.

“The specifications for the new complex will highly depend on EPC [engineering, procurement and construction] contract costs as well as governmental tax benefits,” the official added.

“We are still negotiating with outside parties and I am confident that we will complete the feasibility study for the project by early next year,” the official said without elaborating further.

Honam is expecting to complete the mechanical completion of the new petrochemical complex by 2016, with commercial production expected in the same year, a second company source said.

($1 = €0.75)

By: Nurluqman Suratman

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