PTT Global Chemical Plc (PTTGC), Thailand's largest petrochemical producer, formed a partnership with Sinochem Group, one of China's giant state-owned oil companies, to explore joint investments in China and overseas.
PTTGC chief executive Anon Sirisaengtaksin (right) exchanges the memorandum signed with Pan Zhengyi, vice-president for chemical business at Sinochem Group (left), witnessed by Thai Energy Minister Pongsak Raktapongpaisal. APICHIT JINAKUL
Under a memorandum of understanding (MoU) signed on Monday, PTTGC and Sinochem will jointly explore opportunities for collaboration in sales and marketing as well as potential investments in specialty chemicals and petrochemical projects. The venture aims to harness the advantages both firms bring along the value chain, covering other strategic locations beyond China.
PTTGC, which is under siege as its pipeline leak caused a major oil spill spreading to Koh Samet in Rayong, also signed an agreement with Sinochem International Corp, an affiliate of Sinochem Group, to jointly conduct market evaluations for specialty chemicals focusing on the Chinese market. The results will determine an appropriate collaboration framework for specialty chemicals to serve growing demand in the automotive, construction, and electronics and electrical appliance markets in China.
PTTGC has been working to build a collaboration platform with Sinochem and its affiliates on multiple fronts, said chief executive Anon Sirisaengtaksin.
"This collaboration aligns with PTTGC's aspiration to extend our footprint in China and beyond," he added.
He said PTTGC wants to develop a downstream petrochemical business in China with Sinochem, the fourth-largest petroleum firm on the mainland.
The alliance will start with a feasibility study of isocyanate production, which is a feedstock for foam and cushions. The study, which will start next month and end early next year, will include other petrochemical feedstocks in the automotive, building material, electronics and electrical sectors, where demand has risen sharply in China.
Sinochem is developing its petrochemical complex at Quanzhou that includes a 200,000-barrel-per-day oil refinery, an 800,000-tonne aromatics plant and a million-tonne olefins cracker. The project is expected to run at full capacity in 2017.
Sinochem will consider asking PTTGC to join work on many parts of this chemical complex.
Shares of PTTGC closed yesterday on the Stock Exchange of Thailand at 73.25 baht, down 75 satang, in trade worth 860 million baht.