Will Taiwan’s ethylene supply dwindle if Kuokuang complex is scrapped?

07-Apr-11

Taiwan’s supply of ethylene will become problematic by 2015 if a proposed petrochemical development project is scrapped, a Ministry of Economic Affairs official said to Taipei Times. The proposed Kuokuang complex in Changhua County is planned to offer a major alternative supply after the state-run oil refiner CPC Corp, Taiwan (CPC) closes its fifth naphtha cracker in Greater Kaohsiung in 2015. With petrochemical demand growing as the economy develops, the project will be necessary to fill the shortfall that will be caused when the fifth naphtha cracker closes. Taiwan currently meets 97% of its domestic ethylene needs with annual production of 3 mln tons, including 500,000 tons produced by CPC’s fifth naphtha cracker. Since a petrochemical plant takes about 4-5 years, if the Kuokuang project is not given the go-ahead soon, the industry would soon face an ethylene shortfall and lose ground to other regional rivals in the industry. Singapore began promoting its petrochemical industry four years ago, around the same time that Taiwan started pushing the Kuokuang project. Today, Singapore’s petrochemical park has already attracted investment from the US and the Netherlands and the city-state -produces more than 3 million tonnes of ethylene a year, posing a threat to Taiwan’s petrochemical industry. Environmentalists believe the complex will create costs that outweigh its economic benefits, including damaging the local aquaculture sector and the Dacheng Wetland, while putting the health of local residents at risk.