CPC and 5 others to invest US$ 11.75 billion in Yunlin Petrochemical Technology Park

07-Feb-05

In a bid to increase the state-owned company's production of fuels and chemicals, Chinese Petroleum Corp. and five other shareholders have agreed to invest NT$370 billion (US$11.75) in the Yunlin Petrochemical Technology Park project. CPC, the largest shareholder, will hold 43% stake, Chang Chun Group and Oriental Union Chemical Corp will hold 20% each, China Man-made Fiber Corp will hold 10%, Ho Tung Chemical Corp- 5% and Yunlin-based Chuan Yang Investment Co will hold 2%. A joint decision by the 6 original shareholders would be necessary to allow the participation of any new shareholders in the future. The project includes a 300,000 bpd crude oil refinery, a naphta cracker plant capable of producing 1.2 million tpa ethylene, an aromatics complex and 23 petrochemical derivatives. Keeping in view the period of 12 to 18 months required to complete the environmental impact evaluation of the designated harbor, the 9 year project may see a slight delay in its completion date, which was originally set for 2014. By the end of March, the 6 shareholders will proportionately allocate up to NT$600 million in initial capital to launch the project's preparatory work. The six shareholders will inject a total of NT$123 billion into the project, while the remaining two-thirds of capital will be secured from future bank loans. The joint-venture project is estimated to create an output value of NT$300 billion per year, contributing growth of 0.91% to the nation's GDP.