IRPC delays phase-2 upgrade to next year
IRPC has postponed the second phase of its refinery upgrade to next year, as the government has pushed out implementation of the Euro IV environment standard by a year to 2012.
The upgrade was kicked off this year and the second phase was originally planned for later in the year, with completion slated in two years. At a cost of US$1.1 billion to $1.3 billion (Bt38.15 billion to Bt45 billion), the upgrade will increase the refinery's production capacity from 215,000 barrels per day to 260,000bpd, CEO Piti Yimprasert said yesterday. It now runs at 190,000bpd. The company has hired Shell Global Connections for $8 million to advise on improving the efficiency of all its plants. It expects the improvements to cost about $60 million. Shell has guaranteed that IRPC's refinery margin will increase by 30 cents per barrel in the first year and 60 cents in the second year, which will boost the company's revenue by more than $40 million annually. Yesterday, IRPC reported that first-quarter net profit rose 27 per cent year on year to Bt3.52 billion due to lower sales costs and interest expenses, plus asset sales. While targeting to refinance a bridging loan to reduce its debts to Bt20 billion this year, IRPC will this year start production of HDPE, which carries a higher profit margin than low-density plastic. Piti is confident revenue will be higher this year due to higher product prices. IRPC plans to join the upcoming independent power producer bidding, specifically for the construction of a 1,400-megawatt coal-fired plant. Prachai Leophairatana, the founder of IRPC, might want to buy back his shares in the company from PTT and the strategic partners, but Piti said it all depended on whether shareholders wanted to sell. Prachai has reportedly approached the government to buy at Bt3.30. IRPC stock closed at Bt5.90 yesterday.
Chalida Ekvitthayavechnukul The Nation
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