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Published on September 26, 2007

President and CEO Adithep Bisalbutr said yesterday he was confident that second-half sales revenue would be higher than in the first, because of rising prices for monoethylene glycol (MEG).

"The price of MEG is recorded at the highest-ever price at US$1,300 to $1,400 [Bt44,500 to Bt47,900] per tonne, because of insufficient supply in the global market affected by the delay of plants in the Middle East," he said.

In the first six months of the year, the chemicals company generated revenue of Bt30.25 billion.

Adithep is also optimistic that PTT Chemical's revenue in 2008 will reach Bt80 billion, due to additional investment.

"We will start the production of oleo chemical in the last quarter of this year, but we will fully recognise its revenue next year," he said.

Meanwhile, the company has delayed investment in its EVA (ethylene-vinyl acetate) project, which has a production capacity of 100,000 tonnes per year, because of a rise in contract work and plant construction costs.

The company was originally set to spend $146 million on this project, but costs have risen to $210 million, Adithep said.

Nevertheless, its subsidiary Bangkok Polyethylene has been approved to invest $168.2 million to expand its production capacity for high-density polyethylene to 250,000 tonnes per year. The project is scheduled to commence operations in the fourth quarter of 2009.

Adithep also said PTT Chemical would issue Bt4 billion worth of domestic bonds early next month - the first time the company has distributed its bonds to the public. However, he declined to disclose the proportion that will go to retail investors and financial institutions.

Standard Chartered will be the arranger and Thanachart Bank will a co-arranger for selling bonds to small investors.

He said half of the bonds would carry a five-year maturity, the other half 10 years.

"If the bond issue is warmly welcomed, the company will consider raising the amount to Bt6 billion," said Adithep.

The company plans to spend Bt85 billion to Bt90 billion on new projects and capacity expansion in the next five years, Bt28 billion to Bt30 billion of it falling next year.

Adithep said PTT Chemical would prefer to issue domestic bonds or borrow from local financial institutions rather than mobilise funds from abroad, due to the poor climate of the US market following its sub-prime mortgage crisis.

Chalida   Ekvitthayavechnukul

 The Nation