Specialty chemicals, green initiatives keep PetChem on innovation drive
22 Apr 2021
KUALA LUMPUR (April 22): Petronas Chemicals Group Bhd (PetChem) has shared some exciting details about the innovation drive within the company to generate future growth and maintain its foothold in its markets.
The group has continued to innovate in order to make further inroads in the high-growth segment of specialty chemicals, and also undertaken green initiatives to partly support Petroliam Nasional Bhd’s (Petronas) net zero emission target by 2050.
Two years on, PetChem has made progress in its proposed collaboration with chemical recycling company Plastic Energy Ltd to develop Southeast Asia’s first chemical recycling plant.
“We have done the feasibility study for the project,” said managing director and chief executive officer Datuk Sazali Hamzah at a virtual press conference after the group’s 23rd annual general meeting today.
“Now we have taken a sample of the processed waste plastic, that was converted into naphtha, to be tested and fed into our sister refinery in Malacca.
“If this works, it will be converted into full-cycle plastic-to-naphtha. Once this is achieved, we will [seek the certification] of the international body ISCC (International Sustainability and Carbon Certification),” he said.
The collaboration was first mooted in June 2019 with plans to build a chemical recycling plant with the capacity to process 25,000 tpa of plastic waste to naphtha. PetChem has already signed memoranda of understanding with suppliers to receive the right waste plastic of the feedstock, which is a critical component of the entire process, said Sazali.
On specialty chemicals, PetChem has two projects currently at the engineering, procurement and construction stage, namely a plant to produce ethoxylates and polyols in Kertih, Terengganu as well as the nitrile butadiene latex plant in Pengerang. Both are expected to come on stream in 2022 and 2023 respectively.
Additionally, the group has also obtained approvals for two expansion projects, namely a silicon blending facility in Gebeng, Pahang as well as a new facility for the lube oil additives & chemicals business in the Netherlands.
The two projects, which targeted to achieve commercial operations in 2021 and 2022, will allow it to target the personal care, food and beverages, and automotive segments in high-growth markets especially in Southeast Asia, said Sazali.
The group last year formed a partnership to improve its chemicals marketing and distribution reach in Indonesia.
In 2020 alone, PetChem saw the introduction of 11 new products, including a special grade polymer that is used to enhance the durability of bubble wraps for packaging.
“It was a timely launch to capture the online commerce market that was booming during the pandemic,” said Sazali. This year, the group expects to introduce at least a dozen new products,” he added.
For the group, this year’s capex allocation will be around the same as last year at RM2.5 billion to RM2.6 billion. It is also evaluating around 10 projects, and expects to reach final investment decision for two or three projects.
“At the same time, we continue to execute our first pilot plant for bio-mono ethylene glycol at Petronas Research Centre,” added Sazali.
“We also continue to evaluate potential specialty chemicals start-up companies via corporate venture capital.
“Our aim is to assess the technology and the markets [they are involved with]… All of these make us excited about our commitment to continuously creating value for all our stakeholders,” he said.
At 3.40pm, PetChem gained 1.54% or 12 sen to RM7.91, valuing it at RM63.28 billion.
Source: The Edge Markets