SCGC signs ethane deals to strengthen Vietnam's LSP plant

SCG Chemicals, or SCGC, continues to drive the recovery of the petrochemical business, accelerating efforts to enhance competitiveness by increasing the use of ethane feedstock at the Long Son Petrochemicals (LSP) plant in Vietnam. This strategic shift is expected to result in lower feedstock costs, increased flexibility in feedstock procurement, and a reduction in greenhouse gas emissions, aligning with environmentally friendly practices.

Sakchai Patiparnpreechavud, chief executive officer & president of SCGC, said, “SCGC is urgently advancing the Ethane Feedstock Enhancement Project at the LSP plant in Vietnam (LSPE) as part of its proactive strategy to strengthen competitiveness and reduce production costs. We are confident in our readiness to capitalize on the recovery of the petrochemical market in the future. The latest progress includes successfully securing ethane feedstock from the United States. We have signed a long-term agreement with an affiliate of Enterprise Products Partners L.P., a leading ethane supplier in the United States, to procure approximately 1 million tons of ethane per year for 15 years. Additionally, we have signed a long-term time charter agreement for three Very Large Ethane Carriers (VLECs) with Mitsui O.S.K. Lines (MOL), a global leading liquefied gas shipowner. MOL will provide 15 years of logistics services, transporting ethane from the United States to Vietnam. The remaining two charter agreements for ethane carriers are currently in progress. This effort ensures that the LSP plant will remain highly competitive in the long term with significantly lower production costs. Designed with flexibility for gas feedstock, the LSP plant has been optimized to utilize up to two-thirds of its feedstock from ethane, while the remaining feedstock will consist of propane and naphtha.”

“Furthermore, we are also expediting the construction of ethane storage tanks, which are specially designed to safely store ethane feedstock at extremely low temperatures of approximately -90 degrees Celsius. Preparations for upgrading production processes and supporting facilities required for feedstock reception are also being accelerated. The project is expected to be completed by the end of 2027, aligning with the anticipated recovery of the petrochemical industry in the region,” added the Chief Executive Officer and President of SCGC.

The LSP plant produces and supplies high-quality polymers for Vietnam’s domestic market and exports to international markets. Products from the LSP plant are renowned for their quality and compliance with global standards. The LSPE project will further enhance the capabilities of the LSP plant, solidifying its position as a key petrochemical production base in the region.

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ALCHEMPro News Desk (HU)