Korean Export Import credit agency that is the majorly funding the proposed P34.38 bln naphtha cracker in Batangas, has given the nod of approval for the project financing. As global economies recover, the Gokongwei Group has received the nod from the Korean Import-Export Bank, but continues to be in discussion about the financial requirements, leading to delays in project implementation. The company’s own initial equity investment of US$30 mln has been pumped for the engineering work of the plant. An agreement has been signed with technology provider Lumus Ltd. to start the site and design development in March next year.
On the planning board since 2005, the company, in May 2008, revised the project with a new commercial operation target of January 2012 at an estimated project cost of P34.38 bln. Costs had escalated by P8.7 bln from the original P25.6 bln and had come under an entirely new unit – JG Summit Olefins Corp. As discussions are underway, the company is going ahead with the design and site development, expecting to operate the plant in 2013. If the financing package from the Korean Eximbank is completed by May to August next year, then the project will be as scheduled. Based on its revised project registration with the BoI, the naphtha cracker plant would have a production capacity of 320,000 tpa of ethylene, 190,000 tons of propylene, 270,000 tons of Py gas, and other by-products such as methane, pyrolysis fuel oil and acid gases.