PTT Global Chemical Plc (PTTGC), the country's largest petrochemical producer, will revive its investment plan for a polylactic acid (PLA) production facility in Rayong later this year.
PLA is a type of biodegradable plastic used as a raw material for plates, bowls and cups, while polybutylene succinate (PBS) is used for making plastic bags and films.
Patiphan Sukhonthaman, chief operating officer for downstream, said the PLA production plant has been delayed for seven years after completion of a feasibility study, with a final investment decision never being reached.
The company had planned to team up with US-based Cargill Inc, an owner of PLA patents, through a new subsidiary, NatureWorks LLC, in 2011. That would have been Cargill's first PLA production facility outside the US, with an annual capacity of 150,000 tonnes.
But PTTGC had to put off the plan because global oil prices collapsed in 2014 and Thailand's economy was in the doldrums.
"PTTGC may ultimately invest in the project on its own, but it is still open to a partnership, including with Cargill," Mr Patiphan said.
He said PTTGC has finished tests on a new bacterial species to be used to produce PLA, to replace juice from corn.
Cargill has many patents, mainly corn-based, but Thailand has abundant sugar cane, so PTTGC will conduct research and development on its own, Mr Patiphan said.
"The test is in the final stage, with the commercial stage coming soon," he said.
PTTGC plans to invest through a subsidiary, Global Green Chemical Plc, a bio-based plastics business.
Once the PLA project is approved, PTTGC will contact large plastic users, including food and drink makers interested in eco-friendly products.
PTTGC's parent firm, PTT Plc, developed another PBS raw material, which it began producing last year at a capacity of 2,000 tonnes annually.
That PBS facility is the country's first bioplastics production plant, operated by PTTMCC Biochem Co, a joint venture between PTT and Mitsubishi Chemical Corporation.
According to Yuanta Securities, PTTGC is forecast to post a record-high net profit of 44 billion baht, up 17% year-on-year, in 2018, thanks to rising global oil prices and greater margins for petrochemical products.
Yuanta stock analyst Parinth Nikornkittikosol said PTTGC is expected to have a robust performance for two years because of its long-term development plans, particularly when it comes to the company's research and development unit.