PTT Chemical Poised to Invest B44bn
Posted on: Friday, 17 March 2006, 12:00 CST
By Yuthana Praiwan, Bangkok Post, Thailand
Mar. 17--PTT Chemical Plc, the newly formed petrochemical subsidiary of PTT Plc, plans new investments of 44 billion baht over the next five years.
The expansion was planned to achieve economy of scale for optimal cost-efficiency and to enhance its competitiveness, said Aditheb Bisalbutr, the president of PTT Chemical, the merged entity from the consolidation of National Petrochemical Plc and Thai Olefins Plc late last year.
Part of the planned investment budget will be used to raise its olefins production to 1.86 million tonnes per year in 2008, from the existing 1.52 million tonnes per year.
Once the olefins expansion is completed, PTT Chemical will be at the forefront in Asia, since it uses cheaper natural gas as feedstock in making olefins.
The company also forecast prices of olefins would likely come down starting from 2009, the beginning of the downward cycle of the industry. However, the lower prices can be offset by the high prices of downstream products in which the company will start investing this year.
A proportion of the new funds will be used in expanding business into downstream chemical products to diversify business risks and other supporting businesses to stabilise production and maintain cost-efficiency. The businesses include ethylene oxide/ethylene glycol, methyl ester/fatty alcohol, ethylene vinyl acetate, an ethane cracking unit, phenols and aromatics.
In addition, the company also aims to co-invest with other firms in relevant businesses.
PTT Chemical might join PTT and The Aromatics Thailand Plc, another subsidiary of PTT, in the utility service project to supply power, steam and water to PTT Chemical's plant. It may also invest in PTT Polymer Marketing and Bangkok Polyethylene for the marketing and distribution of PTT subsidiaries' polymer products, as well as in the gas turbine generator project with a 35-megawatt capacity, and a waste heat boiler with an output of 70 tonnes per hour.
According to Mr Aditheb, the company plans two major growth strategies to strengthen the organisation and enhance its readiness to become one of the world's leading petrochemical manufacturers.
PTT Chemical shares closed yesterday on the Stock Exchange of Thailand at 85.50 baht, down one baht, in trade worth 74.78 million baht.
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Source: Bangkok Post
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