Thai Plastic and Chemicals (TPC), one of two companies whose operating licences for projects in Map Ta Phut have been revoked, says it will no longer make major investments in the petrochemical industry in Thailand but will shift its focus overseas.
After the Central Administrative Court's ruling on Thursday, the company fore?sees that it will be difficult to invest in the upstream and mid?stream petrochemical indus?tries here, said managing direc?tor Kanet Khaochan.
At a press conference yester?day, Kanet said Article 67 (2) of the Constitution, which requires more procedures if a petrochemical company wants to invest in Thailand, would make it difficult for operators in the petrochemical industry to invest in new projects. Hence TPC, which is a manufacturer of midstream and downstream petrochemical products, would have to consider the new upstream and midstream petrochemical projects of PTT Group or Siam Cement Group (SCG) before deciding to invest in its downstream business.
Besides, he said, there is not enough space for investment in the petrochemical industry in Thailand, as the Map Ta Phut industrial estate is nearly full. So it was better for TPC to focus on overseas investment.
He said the company's investment in Thailand from now on would be minor, such as removing bottlenecks in the downstream petrochemical business.
TPC along with its major shareholder SCG is planning to co-invest in a US$4.5 billion (Bt140 billion) petrochemical complex in Vietnam with Vietnam Oil and Gas Group (PetroVietnam), Vietnam National Chemical Corp (Vinachem) and Qatar Petroleum International (QPI). The project is expected to start construction by the end of 2011.
The petrochemical complex, which will start production in the next four to five years, will manufacture vinyl chloride monomer (VCM) with a capac?ity of 400,000 tonnes per year, Kanet said.
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TPC has a polyvinyl chloride (PVC) manufacturing plant in Vietnam with a production capacity of nearly 200,000 tonnes per year.
TPC's debottlenecking of VCM in Thailand is expected to be on the list of harmful proj?ects to the environment, as it is a midstream petrochemical business. Another project - the debottlenecking of PVC - is a downstream business, so the company can resume activity as soon as it gets approval from the Industrial Estate Authority of Thailand.
Kanet said TPC had con?ducted the environmental impact assessment (EIA) and health impact assessment (HIA) of the VCM expansion project early this year. However, it will ask the Office of Natural Resources and Environmental Policy and Planning next week whether it can proceed based on those assessments or has to conduct new ones. If it is not necessary to restart assessment process, the company expects to complete the reports by the end of this year, and it should be granted an operating licence and construction licence by the middle of 2011. So the VCM debottlenecking project is expected to start production in the third quarter of next year.
TPC can increase its VCM production capacity to 590,000 tonnes per annum from the cur?rent of 500,000 tonnes. Meanwhile, it expects to start expanding PVC production in October or November. PVC production capacity will rise to 530,000 tonnes per year from the current 480,000 tonnes.
Kanet said the delay of the two projects would not affect TPC's revenue this year, as it did not include them when calcu?lating its estimate. The compa?ny expects to generate revenue of Bt26 billion this year com?pared with Bt24.884 billion in 2009.