IRPC plans major refinery improvement
Petrochemical giant IRPC is speeding up a feasibility study on improving and expanding its petroleum-refining capacity in anticipation of an upward cycle in refining margins and says it expects to finalise its US$1-billion (Bt34.84 billion) investment plan in the second half of the year.
Company president Piti Yimprasert said continued investment was being inspired by relatively high crude-oil prices. "This encourages us to improve and expand our refining capacity further, from 190,000 barrels per day at present to 260,000bpd. This should require an investment of about $1 billion," he said. Shell Global Solutions has been assigned to study the project in detail, and once its study is complete - tentatively scheduled for the second half of the year - the investment may proceed in stages over the next four years. Piti said the project required a huge investment, because IRPC's refinery was an upstream petrochemical plant producing a variety of feedstocks, and it had not undergone any improvement for more than 10 years. "This requires us to be thorough in our decision-making," he said. IRPC, which is 31.5-per-cent owned by PTT, was previously known as Thai Petrochemical Industries. The project will increase the refinery's capacity and allow it to reduce the refining of bunker oil and increase its capacity for finished products of higher value. It will also ensure that IRPC's products meet Euro-4 environment standards, which come into effect in 2011. It is expected that refining margins will remain high for three to four years before returning to a downward cycle. In this year's first quarter, average refining margins were $6 to $7 per barrel. "This is a comfortable level, given that the margin for new refineries must be $6 to $8 a barrel," Piti said. However, IRPC's refining margin is presently below the average, because it is producing high quantities of cheap bunker oil. Aside from the improvement project, IRPC is also planning to bid for a contract as an independent power producer. Before 2011, it plans to construct a coal-fired power plant with the capacity to generate 700-800 megawatts of electricity. The company is currently awaiting the outcome of an environmental-impact assessment of the project. Piti said IRPC was able to construct a coal-fired power plant because its existing wharf could accommodate coal shipments, and the company has a 736-hectare plot in its industrial estate capable of accommodating a 2,000MW plant.
|
