PTTGC poised for venture with Daelim

SET-listed PTT Global Chemical Plc (PTTGC), Thailand’s largest petrochemical producer, expects to sign a joint venture agreement with Korea-based Daelim Industrial Co within the first quarter next year to start development of petrochemical crackers in the US.

The cracker is a fundamental raw material for general plastic products such as film bags and tableware.

Chief executive Supattanapong Punmeechaow said PTTGC will invest in this project through US subsidiary PTTGC America Llc.

The project selected a site in Mead Township along the Ohio River in Belmont County in 2017.

PTTGC America’s board of directors also approved the execution of this agreement between the company and Daelim’s subsidiary to conduct a feasibility study and secure funding for this complex development.

Daelim is a leading Korean construction and chemical company.

“The US site is located in the Marcellus and Utica shale region, with access to a major highway, rail, pipeline and port infrastructure in the US,” he said.

“The cracker will increase efficiency while reducing transport costs.”

The project will be capable of producing 1.5 metric tonnes of ethylene and derivatives per year, said Mr Supattanapong.

PTTGC America invested US$100 million (3.30 billion baht) to implement a detailed front-end engineering design for this cracker complex.

He expects PTTGC’s net profit this year to reach a record high after posting 36 billion baht over the first nine months, up by 21% year-on-year.

PTTGC’s net profit in 2017 was 39.3 billion baht.

“We are confident about our results for this year,” said Mr Supattanapong.

He expects 2018 revenue to stay above 500 billion baht, thanks to global oil prices, projected in a range between $72-74 per barrel.

PTTGC reported revenue over the first nine months rose by 22% to 387 billion baht because of higher sales volume.

He said as global polymer prices have declined, raw material costs have risen, but PTTGC can offset them by increasing the output of downstream petrochemicals.

PTTGC recently announced commercial-scale recycling of single-use plastic products at Rayong Industrial Estate in Map Ta Phut.

The project will have the capacity to recycle roughly 30,000-40,000 tonnes per year.