Bangkok--6 Jun--SCG
Mr. Roongrote Rangsiyopash, President and CEO of SCG, said "SCG have increased the stake in Long Son Petrochemicals Company Limited (LSP)'s from 71% to 100%, which will be the first petrochemicals complex in Vietnam. This project's production capacity of olefins is 1.6 million tons per year, which is used to produce plastic pellets; HDPE, LLDPE and PP to meet the demand in Vietnam, which is currently at 2.3 million tons per year, and is expected to grow further, due to the high economic growth of the country."
This investment will enhance SCG's competitive capabilities in the Chemicals Business within the region, as LSP will be Vietnam's first fully integrated petrochemical project. It is project of world scale, with high competitiveness, as it uses world class technology which include high flexibility in raw materials usage. This will allow LSP to use gas feedstock up to 70% of its raw materials. This makes the cost of materials lower than other petrochemicals plants in the region. In addition, LSP has received the fullest supports and incentives from the Vietnam government as it employed modern and first time use of technology in the country. LSP carries an investment cost of $5.4 billion Dollar or approximately 173,000 million Baht, which is very competitively prices when compared to other projects globally. In terms of innovations, SCG is looking to introduce various production techniques, expertise and experience into LSP, including the use of digital technology, to maximize the production, safety and environmental friendly. On the financial aspect of LSP, the project will be funded with the combination of debt and equity, with the ratio of 60:40 ratio, whereby the initial usage will be in the third quarter of 2018 when SCG commences the construction of LSP.
Mr. Roongrote added that "SCG has a strong financial structure, whereby cash & cash under management at the end of Q1/2018 was at 68 billion Baht, and the net debt to EBITDA leverage was at a conservative 1.6 times. Additionally, SCG continues to adhere to its stringent risk management plans, where the outlook of the petrochemical industry call for an extended upcycle out to 2022, brought on by the global underinvestment of chemicals projects.
LSP is located 100 kilometers away from Ho Chi Minh City in Ba Ria – Vung Tau. The project is committed to the implementation of strict safety standards and environmentally friendly policies to ensure peaceful coexistence with the community and Vietnam. Like other operations in Packaging Business, Cement - Building Materials Business, SCG makes a solid determination to create better-living standards to all stakeholders in the region.