Chevron Chemical Co. is making a major push into Thailand's petrochemical sector, which it intends to use as the base of its Southeast Asia petrochemical operations.
Chevron soon will sign a memorandum of understanding to acquire big stakes in a paraxylene project and an aromatics complex in Thailand. The first deal involves a 30% interest in the $231 million paraxylene plant being built by Thai Paraxylene Co. (TPC), currently owned 62% by refiner Thai Oil Co. (TOC) and 38% by Mitsubishi Oil Co.
The other calls for Chevron acquiring up to a 22% interest in Aromatics (Thailand) Co. plc's (ATC) $700 million aromatics plant in Rayong. State-owned Petroleum Authority of Thailand (PTT) presently holds a 44% share in ATC (see related story, this page).
Chevron's move to acquire the TPC and ATC interests follow its recent decision to shelve a $1.4 billion joint venture plan with PTT to build what would have been Thailand's second aromatics complex, in response to the slump in aromatic prices and Asia's economic crisis. Chevron had hoped to take a 60% stake in the new aromatics project, with PTT holding 40%, but Chevron decided to delay it by 21/2 years from an original start-up date of 2000. It would have the capacity to produce 675,000 metric tons/year of paraxylene and 600,000 tons/year of benzene. Viroj Mavichak, director of PTT's petrochemical business, said the acquisition of ATC could be a shortcut for Chevron to expand its business without spending a lot of money. ATC and TPC then could enable Chevron to meet its aromatics supply contracts in Southeast Asia to 2000, without having to construct the complex it planned with PTT. Chevron's investment in TPC would infuse the paraxylene project with much-needed capital after it was hit by financing problems owing to Asia's economic crisis and TOC's fiscal woes. It will help restore credit-worthiness with lenders, thus ensuring completion of the project-under construction by JGC Corp.-in November next year. The paraxylene plant is being built next to TOC's 220,000 b/d refinery at Chon Buri. It will have a capacity of 300,000 tons/year, with TOC supplying mixed xylene feedstocks.
Plans are also on tap for ATC and TPC to boost their capacities. ATC would hike Rayong plant capacity by 10% from its current 320,000 tons/year of paraxylene and 200,000 tons/year of benzene. TPC would expand its capacity by 25% to 500,000 tons/year.
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