PTTGC expands in Thailand, eyes new markets in SE Asia

Pearl Bantillo

30-Jun-2016

Supattanapong Punmeechaow, PTTGC CEO (Source: PTTGC official website)

SINGAPORE (ICIS)–PTT Global Chemical (PTTGC) continues to grow its production capacity in Thailand, while looking to its southeast Asian neighbours for possible investment and expansion opportunities amid the slowdown in the Chinese economy, company CEO Supattanapong Punmeechaow told ICIS.

The company is forging ahead with expansions at its Map Ta Phut petrochemical hub in Rayong province, where capacity is expected to increase “by as much as 9% this year”, he said.

These include the $128.8m aromatics II facility expansion, which began commercial operations in May this year. The unit’s production capacity for paraxylene (PX) increased by 115,000 tonnes/year; benzene by 35,000 tonnes/year; and orthoxylene by 20,000 tonnes/year, based on PTTGC data provided to ICIS.

It also spent $345m to build a new phenol facility called Phenol II, which can produce 250,000 tonnes/year of phenol and 155,000 tonnes/year of acetone. The project was commissioned in February this year.

In the coming years, PTTGC expects to start-up its propylene oxide/polyols projects, as well as its $288.2m metallocene linear low density polyethylene (MLLDPE) plant, which has a 400,000 tonne/year capacity.

“PTTGC’s investment plan for our petrochemical business in both domestic and international markets focuses on business sectors in which the company already has expertise, as well as a high-volume specialties business unit that is an added value product resulting from our current product in response to the demands of society, now and in the future,” Supattanapong said.

“The current low oil prices help reduced energy, feedstock, and development costs related to investment in construction,” he said.

PTTGC is also diversifying its feedstock for petrochemical production through what is called as the “Map Ta Phut Retrofit Project”, which involves the building of a new naphtha cracker that will produce 500,000 tonnes/year of ethylene and 261,000 tonnes/year of propylene, as well as mixed C4 and pyrolysis gas (pygas).

The project will raise PTTGC’s naphtha usage at Map Ta Phut to 34% from around 10% currently, Supattanapong said.

The company currently has three gas crackers at the site with a combined capacity of 1.86m tonnes/year, and one cracker with a 515,000 tonne/year capacity that runs on naphtha.

China, the world’s second-biggest economy, is major export market for the Thai chemical producer. Economic expansion in the country has steadily decelerated over the past five years, clocking its lowest GDP growth in 25 years in 2015 at 6.9%.

Supattanapong, however, said that China “remains in a secure position” in spite of the slowdown.

“For the new markets, PTTGC is currently studying investment opportunities in the Indonesian market as well as the CLMV countries, which are Cambodia, Laos, Myanmar, and Vietnam,” he said.

“All are considered high-potential markets, especially Myanmar and Vietnam, both of which have a high demand for plastics.”

Supattanapong cited that opportunities are also strong in the ASEAN Economic Community (AEC), given an annual growth rate of 8%.

“Consequently, PTTGC is providing support regarding materials, consulting, and technical services to our customers in the plastics industry that are interested in setting up plants and marketing in Myanmar and the other CLMV countries,” the company executive said.

In Vietnam, Thai oil and gas giant PTT, the parent of PTTGC, has a plan to build a fully-integrated oil refinery and petrochemical complex in Vietnam’s Binh Dinh province. But the project is facing delays, according to newswire agency Reuters.

PTTGC is also upbeat in Indonesia, where it has formed a joint venture (JV) with state-owned energy firm Pertamina for the building of a world-scale petrochemical complex to serve the domestic market.

But the project is currently on hold, with Pertamina concentrating on upstream development.

“The planned petrochemical complex in Indonesia has not made progress. This is because Indonesia has opted to prioritize investment in the refinery sector. Therefore, the petrochemical business has to wait until the near future,” Supattanapong said.

Across the Pacific, the company is looking at building an ethane cracker in the US and will make a final investment decision on the project in 2017.

Interview article by Pearl Bantillo

Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections

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