09-02-2012
SCG joins with Qatari and Vietnamese partners towards Vietnam’s first Petrochemicals complex
The Siam Cement Public Company Limited hereby announces that The Siam Cement Group and its Vietnamese and Qatari partners have together signed the “Joint Venture Agreement” to invest in Vietnam’s first petrochemicals complex, reaffirmingcommitment towards the $4.5 billion project, with an investment decision expected in 2013.
This follows the signing of the “Framework Agreement” which was announced to the Stock Exchange of Thailand (or “SET”) earlier in November 2009, and the “Investment Agreement” in January 2012.
Following the signing of this joint venture agreement, and finalization of the financing agreements, commercial operation is expected to be 4-5 years post-groundbreaking. Vietnam’s first integrated petrochemicals complex will be the spring board into value added and downstream industries for the country, thus solidifying its competitiveness and capturingthe ASEAN growth for Vietnam. SCG’s stake in the project is 28% (from 53% earlier), while Thai Plastic and Chemicals holdsanother 18%. The other significant partners will be comprised of QPI Vietnam (subsidiary of Qatar Petroleum International), PetroVietnam and Vinachem.
Also, as part of the ceremony, Qatar International Petroleum Marketing Comp. Ltd. (TASWEEQ) Q.J.S.C. (the exclusive marketer of Regulated Products from Qatar) signed a long term feedstock agreement to supply the cracker with propane and naphtha, while PV GAS (subsidiary of PetroVietnam) signed a Memorandum of Understanding to supply ethane. Availability of long term feedstock is essential to the competitiveness of this project, in addition to full integration, and economies of scale.
The complex’s capacity will consist of a 1.4 Million Ton olefins from a flexible cracker utilizing ethane, propane and naphtha as feedstock with supporting infrastructure, such as storage facilities, port, jetty, power plant and other utilities. Furthermore, the cracker will be fully integrated with a wide range of downstream products, including polyethylene (PE), polypropylene (PP) and vinyl chloride monomer (VCM). The majority of these products will be consumed domestically, supporting a total Vietnamese population of approximately 90 million.The petrochemicals complex will utilize state-of-the-art technology and international standards in health, safety and environment. Its products will be able to serve growing demand in both Vietnam and ASEAN.
Located on Long Son Island, province of Ba Ria - Vung Tau in southern Vietnam and adjacent to Vietnam’s future refinery for operational synergy, the petrochemicals complex will be in close proximity to the primary southern Vietnamese market i.e. approximately 100 km southeast of Ho Chi Minh City. The complex has an excellent synergy with a wide array of Vietnamese industries such as consumer goods packaging, PVC pipe, profiles, electrical appliances, auto industry, etc., all of which will help contribute to the growth of the Vietnamese economy.
The restructuring of shareholding in the said project is exempt from SET’s rule of information disclosure concerning the acquisition and disposition of assets of listed companies and is not a connected transaction.
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