19 April 2013 09:28 [Source: ICB]
Engro Polymer & Chemicals has started the debottlenecking process at its polyvinyl chloride (PVC) plants at Port Qasim that will increase the units' production capacity by about 13% in July, the top executive of the Pakistan-based company said on 8 April.
Pakistan PVC consumption is growing despite major energy issues
"Once it is completed, we will decide about further expansion to add another 25,000 tonnes/year of PVC capacity to match it with the 200,000 tonnes/year capacity of our VCM [vinyl chloride monomer] plant," he said.
The PVC plants - a 100,000 tonnes/year unit and a 55,000 tonne/year unit, which was installed as part of the company's back integration project for its VCM plant - are currently running at full capacity, he added.
"The two-step PVC debottlenecking project is expected to be completed by the middle of 2014, with first-step completion being targeted for July this year," Subhani said.
Engro had initially wanted to increase its PVC capacity last year, but stabilising operations at its VCM facility after back-integration took longer than expected.
"Our main focus during [the] past few years had been towards stabilising the VCM plant operations, Subhani said.
"Since then, we have come a long way as far as VCM plant operation and VCM production are concerned, and now have surplus VCM available, which is being exported," he added.
The back-integration of its ethylene dichloride-vinyl chloride monomer (EDC-VCM) and chlor-alkali production facilities had gone well, and the integrated complex is operating smoothly, he said.
Total PVC resins consumption in Pakistan in 2012 was around 145,000 tonnes, with Engro having a 93% share of the market. The rest of Pakistan's requirements were met by imports.
"In addition to this, around 30,000 tonnes of PVC plastic scrap was also imported, which makes the total PVC market [of Pakistan] to be around 175,000 tonnes/year," Subhani explained.
Pakistan's PVC market continues to grow, backed by rising population and the associated increase in domestic consumption and exports, in spite of a crippling power crisis that the country faces, he said.
"Though [the] Pakistani rupee['s] depreciation has its negative effects on the country's external segment, like balance of payments, it provides immediate competitiveness to the country's exports, giving it a boost," Subhani said.
"Shortage of energy is indeed a genuine issue which has brought about significant limitation in Pakistan's growth. However, businesses have successfully survived the situation, driven by robust domestic market demand," he said.
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