Formosa to invest in petrochem, shale gas exploration through FPC USA

30-Sep-11
Formosa Plastic Corp. (FPC) plans to invest in petrochemicals and shale gas exploration through its overseas subsidiary FPC USA, to raise deployment in the U.S., as per CENS. Mature and commercialization of low-cost shale gas exploration technologies will enable FPC USA to boost production capacity of ethylene and propylene. Investment outlay is estimated at US$400 mln to build a 400,000 tpa ethylene plant. FPC holds 22.6% stake in FPC USA, which owns 300 natural-gas wells and will expand annual capacities of ethylene and propylene by 2.1 mln tons and 1.15 mln tons, respectively by the end of 2013, with the expansions to cost approximately NT$30 billion. FPC USA can produce 1.62 mln tons of ethylene in its two plants each in Louisiana and Texas, but 400,000 tons of ethylene has to be outsourced for downstream plants in USA. Since the beginning of this year, FPC USA has seen substantial growth in profitability due to adoption of low-cost natural gas, posting NT$8.78 billion in the first half for a historic high.
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