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Deal inked for first petrochemical plant

Update: February, 13/2012 - 10:13

HCM CITY — The Thai-owned Siam Cement Group, Qatar Petroleum International, PetroVietnam, and the Viet Nam National Chemical Group signed in Bangkok last week an agreement to invest in Viet Nam's first petrochemicals project in Ba Ria-Vung Tau Province.

Kan Trakulhoon, president and CEO of SCG said: "With the investment of $4.5 billion, the project will be Viet Nam's first integrated petrochemicals complex, serving as a springboard for import substitution and value-added conversion industries for the country, and a vehicle to capture the ASEAN growth for the country.

"In addition to full integration and economies of scale, security and availability of long-term feedstock is essential for the competitiveness of this project.

"Qatar International Petroleum Marketing Comp. Ltd. (TASWEEQ), the exclusive marketer of regulated products from Qatar, signed a long-term agreement to supply propane and naphtha for the cracker plant, while PV GAS, a subsidiary of PetroVietnam, signed a memorandum of understanding to supply ethane."

SCG holds a 28 per cent stake in the project, while Thai Plastic and Chemicals, an SCG affiliate holds another 18 per cent.

QPI Viet Nam (a subsidiary of Qatar Petroleum International), Petro Viet Nam, and Vinachem hold the remaining stake.

The plant is expected to begin commercial operation in the next four years, producing 1.4 million tonnes of olefins besides downstream products like polyethylene, polypropylene, and vinyl chloride monomer.

It has support infrastructure such as storage facilities, port, jetty, power plant, and other utilities.

The majority of the output will be consumed domestically, though other ASEAN member countries are also on the JV's radar.

Located in Long Son Island – adjacent to a planned oil refinery for operational synergy – the petrochemical complex will be close to the southern Vietnamese market.

The complex also has excellent synergy with a wide array of Vietnamese industries that require its products – such as manufacturers of consumer goods packaging, PVC pipes, electrical appliances, and automobiles. — VNS

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