IRPC takes high-value road

IRPC takes high-value road

Polymer market in Asia hotting up

IRPC Plc, the petrochemical business arm of the national oil and gas conglomerate PTT Plc, expects its huge investment in high-value petrochemical products to generate greater income in the coming year.

Sukrit: Big investment on UHV products

IRPC president Sukrit Surabotsopon said these products currently generate about 30% of total revenue, up from 10% in 2013.

Production of high-value products was the aim of a huge investment scheme under IRPC's Phoenix and upstream product development projects, with a combined investment of 90 billion baht from 2013-16, he said. They are upstream projects for hygiene and value-added products (UHV).

Mr Sukrit expected UHV products would generate up to 50% of total income by 2020.

"This will help us as competition intensifies in the near future as there are many new producers of commodity-grade polymers in Asia," he said.

The new UHV products this year are ultra-high density polyethylene, pipe-grade polymers, anti-bacterial polymers and green acrylonitrile butadiene styrene (ABS) polymers.

Besides increasing UHV production, the company is also upgrading plant facilities and increasing utilisation of infrastructure to cut costs and raise productivity.

Mr Sukrit said the facility upgrade would enhance refinery capacity to 200,000 barrels per day this year, up from 170,000 bpd in 2014.

The final phase of IRPC's UHV project is to increase production capacity of polypropylene to 3.22 million tonnes per year. It is under construction and scheduled to start operation by early 2017.

In order to capture UHV market share in Asia, the company created a joint venture with PCC Rokita SA, a Poland-based leader in speciality polyurethane, to work on market development and production issues. 

The company is looking to develop green ABS polymer products in Japan and Thailand via cooperation with IRPC A&L and Sumi-Thai Group.

IRPC doubled its budget for research and development to 200 million baht this year, increasing its R&D staff to 70.

Mr Sukrit said weak global oil prices could reduce revenue short-term, even though falling oil prices increase profits for polymers, a by-product of oil. Oil prices have slashed fuel costs of production to 3% from 6%.

IRPC plans to invest 45 billion baht to develop speciality polymers. It is also doing a feasible study on production facilities for bio-hydrofined diesel, paraxylene, styrene monomers and polyol.

IRPC shares closed on Friday on the SET at 3.94 baht, down six satang, in trade worth 505 million baht.

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