APIC '14: PETRONAS' new refinery to come on stream in 2019: MPA

15 May 2014 06:30 Source:ICIS News

PATTAYA, Thailand (ICIS)--PETRONAS' new 300,000 bbl/day refinery at the Pengerang Integrated Complex (PIC) in southern Johor is expected to come on stream in 2019, the Malaysian Petrochemical Association (MPA) said on Thursday.

The PIC will house the Malaysian state-owned energy firm’s Refinery and Petrochemical Integrated Development (RAPID) and other associated facilities.

The project has a total capacity of 7.7m tonnes/year of various grades of products, including differentiated and specialty chemicals, such as synthetic rubbers and high grade polymers, it said in a report prepared for the Asian Petrochemicals Industry Conference (APIC).

The associated facilities includes a raw water supply facility, a power co-generation plant, a liquefied natural gas (LNG) regasification terminal and other ancillary facilities.

RAPID is projected to cost about $16bn to build, while the associated facilities will involve an investment of about $11bn, the MPA said.

PETRONAS earlier this year approved the final investment decision for the development of the PIC, which is part of the larger Pengerang Integrated Petroleum Complex (PIPC) proposed and promoted by the Johor state government, according to the MPA.

"The PIPC is well positioned to be the next regional downstream oil and gas industrial hub,” it said.

Looking ahead, Malaysia's petrochemical industry is facing tougher market conditions with downward pressure on product prices amid massive capacity growth in Asia and the Middle East, the MPA said.

"In order to sustain production volumes, Malaysian producers will need to constrain feedstock costs. In the face of intensified competitiveness in the global market, prospects for the Malaysian petrochemicals industry depend on its ability to cultivate and maintain competitive advantages over competing nations," it said.

Kuala Lumpur's third industrial development plan, for implementation between 2006-2020, plans to boost petrochemical exports to around $11bn by 2020, according to the MPA.

This plan will focus on developing Bintulu, Gurun, Tanjung Pelepas and Labuan into new petrochemical zones, it said. 

"The plan also calls for the construction of three new crackers by 2020," the MPA said.

State-owned PETRONAS has majority stakes in two existing gas-based crackers at Kertih, while Lotte Titan Chemical operates a naphtha-based cracker in Pasir Gudang.

"Two major cracker-based petrochemicals complexes are planned in Kuantan and Johor," it added.

By Nurluqman Suratman