SCG Chemicals plans to invest in another grade of high-value-added (HVA) polyethylene (PE), aiming to start commercial production by year-end, said president Chonlanat Yanaranop.
The company, a subsidiary of industrial conglomerate Siam Cement Group, will submit a proposal to raise HVA capacity for the new grade of PE at next month's board meeting.
"SCG Chemicals will invest in a new grade of PE, for which we need to work out the details of capacity and cost," said Mr Chonlanat, adding that the company has set aside an investment and maintenance budget of 10 billion baht for 2016.
Of the 10-billion-baht budget, 4 billion is earmarked for investment in segments highlighted by the government's super-cluster policy, while 6 billion is for maintenance and buying new machines to replace ageing ones.
The 10 billion baht is separate from the company's mergers and acquisitions plan, said Mr Chonlanat.
Last year, the company had an investment budget of 12-13 billion baht.
"The super cluster project is one the government's investment promotion policies, which targets some special types of HVA petrochemical products such as biochemicals and bioplastics," he said. "It will help Thailand upgrade the country's industrial capabilities for a new generation and create added value for Thai industrial products."
Mr Chonlanat added the new grade of PE would also provide better margins and serve rising demand.
SCG Chemicals supplies a full range of petrochemical products, including upstream petrochemicals such as olefins, intermediate petrochemicals such as styrene monomers and downstream petrochemicals such as polyethylene, polypropylene, polyvinyl chloride and polystyrene resins.