Taiwan's Kuokuang Petrochemical may shift ethylen project to Middle East

05-Jan-07

Taiwan's Kuokuang Petrochemical Technology Co.- a venture led by the state oil company, is facing opposition from conservationists and fishermen for its new chemical project. The Yunlin project was planned with a 300,000 bpd crude oil refinery and an ethylene plant with an annual capacity of 1.2 million metric tons. Failure to get government clearance or acquire land may force a move to shift the planned NT$401 billion (US$12 billion) chemical project to the Middle East from the preferred site in Yunlin in western Taiwan. Countries under consideration are Saudi Arabia, Oman and Abu Dhabi. Taiwan imports almost all its crude oil and more than 90% of its natural gas, hence this shift in plant location will provide the added advantage of cheaper feedstock supply, mean lower costs for land acquisition and quicker completion. This will be Chinese Petroleum's second failure to build an ethylene plant in Taiwan this decade. The first is the lost capacity from a facility in Kaohsiung, southern Taiwan, slated to be shut by 2015 because of complaints from residents about pollution. Chinese Petroleum and Formosa Petrochemical, a Formosa Plastics Group unit, are Taiwan's only oil refiners. Chinese Petroleum is counting on the project in Yunlin to compete with Formosa Plastics Group, which has newer refining units and petrochemical plants