The new facility will be developed jointly with Siam Cement at the Dow-SCC complex at Map Ta Phut in Rayong province.

According to the company's statement, a number of downstream facilities will be developed by Dow in conjunction with the new development. Among those under consideration are a hydrogen-peroxide-to-propylene-oxide (HPPO) plant with technology developed by the company in collaboration with BASF, along with a range of PO derivatives.

PO is used to produce propylene glycol, polyurethanes and glycol ethers.

The new cracker will also allow for the expansion of the existing higher-alpha olefins-polyethylene joint venture facility, which would produce speciality polyolefin products using Dow's advanced catalyst technology.

"This project supports Dow's strategic agenda on several fronts," said Dow chairman and CEO Andrew Liveris.

The new facility "provides a competitive platform on which to develop a range of higher margin performance business opportunities." It is another example of an asset-light investment approach, through which Dow plans to grow in joint ventures with strategic partners like SCC, Liveris added.

The cracker, which is expected to begin operations in 2010, builds on Dow's longstanding relationship with SCC and is the latest in a series of joint ventures between them.

The two companies signed their first joint venture agreement in 1987, and have since formed a total of five such companies, producing polyols, synthetic latex, polystyrene, styrene monomer and polyethylene at the Map Ta Phut site. The SCC-Dow Group of companies has also invested in an ethylene cracker operated by Siam Cement at the site.