GGC readies B7bn complex

GGC readies B7bn complex

A selection of oleochemical products made from biodiesel by Global Green Chemical, a subsidiary of PTT Global Chemical.
A selection of oleochemical products made from biodiesel by Global Green Chemical, a subsidiary of PTT Global Chemical.

Global Green Chemical Plc (GGC), the SET-listed biochemical arm of PTT Global Chemical Plc (PTTGC), plans to kick off development of its 7-billion-baht biochemical complex by the third quarter.

Managing director Jirawat Nooritanon said it plans to enter into a joint venture with sugar miller Kaset Thai International Sugar Corporation (KTIS).

Under the terms of the contract, each company will own a 50% stake in the biochemical complex, which will be located in Nakorn Sawan, near KTIS's sugar farm.

GGC's board of directors are expected to approve the business plan in the third quarter, after approving the recent feasibility study.

In the first phase, the complex will consist of a sugar miller and an ethanol production facility, as well as a power plant fuelled by the waste of the sugar production process, he said.

If everything proceeds as scheduled, the facility will begin commercial operations in early 2020.

Approval of the newly revised Thailand Sugar Act, which would allow ethanol producers to use sugar juice in ethanol feedstock, will be crucial for the project, said Mr Jirawat.

"The partners are waiting for the implementation of this bill, which they think will be in force by the end of the year," he said.

GGC has another ongoing development project waiting for board approval, which will include a 500-million-baht glycerine refinery production facility and a 600-900 million oleo chemical production plant.

The two projects will strengthen the company's offerings in downstream products like feedstock for creams, lotions and skin care and cleansing products. The company currently produces 14,000 tonnes of oleo speciality products per year and 20,000 tonnes of refined glycerine.

Mr Jirawat said GGC's second methyl ester or biodiesel production unit is scheduled to start operations in the third quarter. The facility will have an annual capacity of 200,000 tonnes of methyl ester (ME), which will bring the combined capacity of the two units to 500,000 tonnes.

The demand for diesel in Thailand is limited, which is why the company only produces biodiesel products with a 7% ME content, he said.

Companies in the sector are asking the automotive development policymaker to increase the proportion of ME in biodiesel to 10% (or B10), up from 7% (B7), in order to absorb the surplus ME production capacity.

A decade ago, Thai biofuel policymakers estimated that by 2020, demand for biodiesel in Thailand would increase to 10% of ME, up from 2% in 2005, which is why GGC designed its production facility to accommodate maximum demand for B10.

But car assemblers in Thailand have been reluctant to accept biodiesel blends with more than 7% ME.

If biodiesel is increased to B10, the demand for crude palm oil will expand by 45,000 tonnes a year. Thai crude palm oil stock now stands at 400,000 tonnes, above the average yearly crude palm oil stock of 300,000 tonnes.

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