Vinythai to double VCM capacity

New partnership to take advantage of growing vinyls market in Asia

11-Nov-2004

Solvay announces today that the board of Vinythai PCL (VNT) approved the doubling of the Vinyl Chloride Monomer (VCM) production capacity at its plant in Map Ta Phut, Thailand. The project, which is based on Solvay's latest VCM technology, is estimated to cost roughly Baht 2,300 million (EUR 44 million) and would be debt-financed locally.

Construction will begin in 2005 with production expected to commence in September 2006. The expansion will increase Vinythai's current VCM capacity of 200,000 tons per annum (tpa) to 400,000 tpa. VCM is the major feedstock for PVC production. Of the additional VCM capacity, the Company will sell 150,000 tpa under a long-term contract to a local producer of PVC, APEX Petrochemical Co., Ltd. (APEX) who currently imports VCM for its own PVC production. The remaining 50,000 tpa will be exported or sold domestically. The Company also has a tolling agreement with APEX on the production of 48,000 tpa of PVC produced by APEX, which VNT will market in its own name.

The main raw material required for the expanded capacity, Ethylene Dichloride (EDC), will be sourced by imports from the international markets. The Company is pursuing the study of an upstream integration into chlorine and caustic soda production facility. The decision will be taken after finalizing whether ethylene would be sourced either locally or from abroad.

By getting access to an additional 48 ktpa PVC without additional PVC investment, the Company is well-positioned to take advantage of a growing PVC export market. The expansion project is subject to the approval from the Company's bondholders, the Board of Investment, and the environment impact assessment authorities.

The Company's Board of Directors believes that this expansion will reinforce Vinythai's position as a key player in the regional vinyl industry and add significant value for the Company and its shareholders.

https://www.chemeurope.com/en/news/40773/vinythai-to-double-vcm-capacity.html