Thailand’s Siam Cement Group (SCG) and Vietnam’s state-run energy giant PetroVietnam will start construction work on a petrochemical complex in Vietnam next year.
Vina SCG Chemicals Co., Ltd. (VSCG), a wholly owned subsidiary of Thailand’s Siam Cement Group (SCG), announced that it has approved to proceed with the investment in Long Son Petrochemicals Company Limited (LSP) on July 14.
LSP is positioned to be Vietnam’s first petrochemicals complex. At the heart of the project is a one million tonne ethylene cracker with flexible gas and naphtha feed to yield in total olefins capacity of up to 1.6 million tonnes per year depending on the feedstock mix. LSP is located just 100 km from Ho Chi Minh City, the main market and economic heartland of Vietnam.
The total project cost of LSP is approximately USD5.4 billion. LSP issued the Letter of Award to key contractors on July 14, with final contract signing expected by the second half of 2017. The facility is scheduled to start commercial operations by 2022.
SCG’s indirect stake in LSP is 71% (via Vina SCG Chemicals Co., Ltd. 53% and Thai Plastic and Chemicals Public Company Limited 18%), while PetroVietnam holds 29%.
In 2016, Vietnam imported approximately 2.3 million tonnes of polyolefin products, with expectation of continuous growth in the future.
“The petrochemical complex in Vietnam will be among the largest investments in ASEAN for SCG,” said Roongrote Rangsiyopash, SCG president and chief executive officer.