Six Taiwanese companies to build 1m t/yr cracker in China

Six Taiwanese chemical companies, in partnership with a local Chinese government, are planning to build a 1m tonne/year naphtha cracker in Quanzhou, south eastern Fujian province, an industry official said on Thursday.

Jack J. H. Shieh, executive manager of Petrochemical Industry Association of Taiwan, said that the six companies would hold a 80% stake in the cracker that would cost about $1.5bn (€1.08bn).

These include, Ho Tung Chemical Co, Dairen Chemical Corp, Lee Chang Yung Chemical Industry Co, Chang Chun Plastic Co, Grand Pacific Petrochemical Co and Taiwan Synthetic Rubber Corporation (TSRC). The project still needs approval by the governments of China and Taiwan, If such an approval is given, it would be the first cracker to be built by Taiwan in China, signifying a breakthrough in bilateral ties. Previous attempts by Taiwanese companies such as state-owned CPC Corp and petrochemical giant Formosa have been unsuccessful in lobbying for a cracker on the mainland.

“We have set up a preparation and construction office in Quangang petrochemical industry park,” Shieh said. “We just signed the cooperation agreement on 18 May and definitely expect to kick off the cracker’s construction as soon as possible.”
Shieh said he was quite optimistic that they would get the approval from the Chinese and Taiwanese governments. The feasibility study and the Environmental Impact Assessment (EIA) for the proposed cracker project was underway, he added.

The feedstock naphtha for the cracker would be mainly provided by foreign suppliers and the products would be used by associated downstream plants that were to be built by the six companies, the executive manager said.

The Chinese government had allocated a special area for Taiwanese businesses in Quangang petrochemical industry park, where downstream chemical plants including polypropylene (PP) and styrene monomer (SM) would be built besides the 1m tonne/year cracker, a local Chinese official said.

Zhong Yunfeng, an official from the Quangang Bureau of Foreign Trade and Economic Cooperation, said a total investment of around $6bn would be needed for the cracker and the associated plants to be set up.

These included a 400,000 tonne/year PP plant, a 500,000 tonne/year SM unit, a 160,000 tonne/year methyl tert-butyl ether (MTBE) facility, a 60,000 tonne/year methyl ethyl ketone (MEK) plant, a 350,000 tonne/year vinyl acetate monomer (VAM) unit and a 30,000 tonne/year acrylonitrile butadiene rubber (NBR) plant, Zhong added.

Source: Taiwan Brilliance Shipping Agency