JG Summit reattempts entry into petrochemical sector with an investment of P35 bln

26-May-08

Making a fresh attempt to make a foray in the petrochemical industry, JG Summit Holdings, the holding firm of the Gokongwei group has formed JG Summit Olefins Corp. The company proposes to invest P35 bln towards the construction of a naphtha cracker facility in Batangas. With this announcement, the proposed project cost is now P10 bln more than the original plan applied with the Board of Investments (BoI) in 2005. The naphtha cracker is being planned in Batangas City, adjacent to the existing polymer plant of JG Summit Petrochemical Corp. Production capacity will include 320,000 tpa of ethylene, 190,000 tpa of propylene; 270,000 mt of py gas, and other by-products such as Methane, Pyrolysis fuel Oil, and acid gases. The naphtha cracker project was identified as a strategic industry crucial to the country's industrialization efforts. As part of the fiscal incentives offered by BoI to the revived project, tax breaks of up to 6 years and other incentives have been offered. The BoI believes the proposed project completely integrate the petrochemical industry, reducing the country's dependence on imported ethylene and propylene feedstock. The project is expected to be completed in January 2012.