SCG's Indonesian unit to decide on $800mn investment in H2
The Nation, 30/04/2012
Chandra Asri Petrochemical (CAP), Indonesia's largest petrochemical firm in which Siam Cement Group (SCG) holds a 30-per-cent stake, is expected to finalise in the second half of the year an investment plan for both de-bottle-necking and a downstream petrochemical project that would require an estimated US$800 million (Bt24.6 billion) investment.
Chaovalit Ekabut, vice president for finance and investment and chief financial officer, said last week CAP's board of directors were considering whether or not the company should invest both in de-bottle-necking and downstream petrochemical production at the same time. The global petrochemical industry outlook will be taken into account before the decision is made, problably in the second half of this year. Chaovalit sits on CAP's board of directors.
"SCG Chemicals currently does not need to spend money for expansion in CAP. The spending may happen in the second half of this year," he said.
Kan Trakulhoon, president and chief executive officer, said earlier that as informed by CAP's executive, the combined investment budget for both de-bottle-necking and a new downstream petrochemical plant could be as high as $800 million. CAP is considering the funding for these investments.
Kan said last week that SCG had gained the trust of CAP and the Indonesian petrochemical company was letting SCG source the raw material for production.
CAP has a naphtha cracker with a capacity of 550,000 tonnes per annum. It has two polyethylene (PE) plants, three polypropylene (PP) plants, and two styrene monomer (SM) plants. The annual production capacities of PE, PP and SM are 340,000 tonnes, 480,000 tonnes, and 320,000 tonnes, respectively.
Investment of $800 million in CAP would be lower than the investment required for a new petrochemical plant, which could be as high as $1.4 billion.