PCG To Grow Production Capacity By 49 Pct By 2020

KUALA LUMPUR, April 26 (Bernama) -- Petronas Chemicals Group Bhd (PCG) expects to grow its production capacity by 49 per cent or an increase of 5.3 million tonnes of petrochemicals by 2020 from 10.8 million tonnes currently. Managing Director/ Chief Executive Officer Sazali Hamzah said this would be contributed mostly by the group's Pengerang Integrated Complex (PIC) which was scheduled to be operational in 2019. "As at end of March this year, PIC overall development progress was around 62 per cent, whereby, once it is completed, PCG’s capacity growth is expected to be twice that of its peers by 2020," he told reporters after PCG’s annual general meeting here Wednesday. In 2016, Sazali said the group recorded its highest plant utilisation rate of 96 per cent since its listing, surpassing world-class standard of 85 per cent, as a result of its continuous effort to reach sustainable operational excellence. PCG also registered its highest sales volume in 2016 at 7.3 million tonnes. He added that PCG continued to drive commercial excellence against a bearish environment through better understanding of its customers' needs, sustaining and augmenting its market position, as well as enhancing marketing capability. Meanwhile, PCG Chairman Md Ariff Mahmood said the group allocated some US$919.52 million (RM4 billion) in capital expenditure (capex) this year, about the same amount as last year, of which the bulk would be spent on PIC projects. PCG had on April 18 approved the Final Investment Decision for an isononal plant at PIC for US$442 million, of which its capex utilisation would spread over three years. Md Ariff pointed out that the project would broaden the group’s product portfolio and was part of PCG's strategy to grow further in specialty chemicals. He said the capex would be internally generated. Moving forward, Sazali added that PCG remained cautious on the uncertainties surrounding the market and expected demand for petrochemicals to be moderate. He said petrochemicals prices were linked to crude oil prices and as such, the group saw slight recovery of the product prices in the first quarter of this year, driven by the improvement of the overall energy industry. The group will continue to focus on the delivery of all its growth projects to ensure minimum disruption affecting timeline and cost, he said. PCG will also continue to work on sustaining operational excellence, optimising cost, improving customer experience and further expanding its presence in the region as Southeast Asia remains its key market, he added. -- BERNAMA