IRPC plans to invest upto US$1.3 bln in expansion as company turns around after restructuring

21-May-08

Thailand's IRPC plans to invest upto US$1.3 bln over the next 3-5 years to expand petrochemical and refining operations. The capacity expansion will include increase in HDPE production capacity to 150,000 tpa from 115,000 and ABS capacity increase to 117,000 tons from 97,000 tons. Refining capacity will be hiked to 250,000 bpd from the current 215,000 bpd. In a bid to maintain sales and profit margin spread, the company targets to a reduction in operating costs by US$60 mln this year. IRPC is also studying the possibility of entering the ethanol business. Barely a few years ago, IRPC founded by Prachai Leophairatana, (formerly known as Thai Petrochemical Industry), was on the verge of bankruptcy. Following the 1997 economic crisis, the company had the shameful status of the country's largest non-performing borrower with debt of US$3.7 bln. After years of dispute between Mr Prachai and the creditors, in 2004, the bankruptcy court gave the Finance Ministry authority to help draft a new restructuring plan. The plan was targeted to significantly reduce debt while giving a majority shareholding to PTT Plc, the Government Savings Bank and the Government Pension Fund. The company underwent a management change led by PTT executives and was renamed IRPC.