Vietnam is examining to license a long-delayed giant petrochemical complex costing US$5.4 billion totally invested by Thai conglomerate Siam Cement Group (SCG), local media reported.
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Located in the southern province of Ba Ria-Vung Tau, 100 km to the southeast of Ho Chi Minh City, LSP is designed to have an annual capacity of two million tons of olefins (high-density synthetic fibers), polyetylen, and ploypropylen.
Kicked off in 2008 by a joint venture of SCG, Vietnam National Oil and Gas Group (PetroVietnam), and Qatar Petroleum, the project was stalled due to global recession. In 2015, the Qatari partner withdrew and SCG bought its stake in 2017.
In 2018, SCG purchased PetroVietnam’s 29 percent stake to become the sole owner. The project was resumed in February 2018. Permission for the project had been given to PetroVietnam, but following its pullout, SCG needs to get fresh approval, according to VnExpress.
The delay has driven up the investment cost from US$4.5 billion to US$5.4 billion but SCG believes it is a “very competitive price when compared to other projects globally.”
Funding for the project will be sourced from a syndicate of six Thai and international banks in deals signed in April 2018.
LSP will become Vietnam’s first integrated petrochemical project after it is put into operation in 2023.
SCG Chairman and CEO Roongrote Rangsiyopash told Prime Minister Nguyen Xuan Phuc at a meeting last month that his company would complete the project in time.
LSP is expected to contribute US$60 million to Vietnam’s budget annually. It is estimated to use 1,000 high-qualified engineers and generate around 20,000 jobs during the construction.
With initial investment in Vietnam since 1992, SCG specializes in many sectors namely cement, construction materials, packaging, and petrochemicals with a network of 23 member companies. Its revenues in Vietnam reached VND31 trillion ($1.33 billion) in 2018, up 20% on year.
