A court ruling has halted 64 projects at Map Ta Phut industrial estate in Thailand over environmental concerns. Map Ta Phut is the world's eighth-biggest petrochemicals hub, and this ruling that has shaken investors' confidence and raised questions about legal certainty and government effectiveness in Thailand. This dispute could stifle future investment in Thailand and damage its reputation as a stable place for foreign businesses. The freeze comes amid increased political uncertainty as a crisis is heating up ahead of a big push by lawmakers and protesters seeking to topple the government, putting markets on edge.
Following are major companies affected by the ruling as per Reuters:
* PTT : Thailand's largest publicly listed company and dominant oil and gas firm owns 25 projects worth roughly US$3.9 bln in the zone. Of these, seven can proceed as normal. State-controlled PTT said most of its 25 projects, including its sixth gas separation plant, should be able to operate because they received licences before the
constitutional changes in 2007 that altered health and environment rules. It has lodged an appeal with the court to get the go-ahead, or at least allow construction to continue as planned. PTT has twice delayed consolidation plans aimed at cutting costs and boosting efficiency, underlining the widening financial toll from the row. The freeze on the gas separation plant means Thailand will need to import 1.7 mln tons of liquefied natural gas this year. PTT has been promised compensation from the government
for an estimated loss of 8 billion baht as a result of the delay.
* SIAM CEMENT : 18 projects of Thailand's largest industrial conglomerate, mostly petrochemical operations involving a total investment of 57.5 bln baht (US$1.74 bln), would be suspended. Projects on hold at its Thai Plastic and Chemicals subsidiary include a PVC resin expansion project line 8 and 9 and a VCM expansion project for plant 1 and 2, representing investment worth 280 million baht (US$8.5 mln). Petrochemicals generally make up almost half of profits at Siam Cement, which is 30% owned by the Thai royal family's Crown Property Bureau.
* VINYTHAI : The country's second-largest polyvinyl chloride (PVC) maker said the ruling would delay an expansion project of Chlor-alkali and the upgrade of a Vinylchloride plant.
* Foreign companies affected include a Thai unit of Germany's Bayer, India's Aditya Birla Chemicals and Australia's BlueScope Steel Ltd. One of Aditya Birla's projects was allowed to go ahead. Among the projects affected are a series of joint ventures between Dow Chemical and Siam Cement, Siam Cement and Mitsui Chemical Inc., between PTT, Japan's Asahi Kasei Chemical Corp and Japan's Marubeni Corp.