Taipei, Dec. 14, 2012 (CENS)--Formosa Plastics U.S.A. will invest US$1.7 billion (NT$49.38 billion) to expand its capacities and switch to shale gas as the raw material for its naphtha crackers, which will enable it to cut production cost by 50%.
Formosa Plastics U.S.A. is an affiliate of Formosa Plastics, which owns 22.59% stake in the company. As the U.S. owns mature oil-shale exploration technology and the Texas region bordering Mexico boasts abundant oil-shale resources, the Texas factory of Formosa Plastics U.S.A. is accelerating the construction of natural-gas distillation and distribution facility for the supply of shale gas as its material.
A Formosa Plastics manager noted that the Texas factory will boost the share of shale gas in its materials to 100% in mid-2013, up from 40-50% now, thereby cutting the production cost by 50% and lowering the cost of its ethylene to only half the level of the petrochemical complex of Formosa Plastics Group (FPG) in Mailiao offshore industrial zone, in southern-Taiwan county of Yunlin.
Li Chih-tsun, chairman of Formosa Plastics, reported that Formosa Plastics U.S.A. has applied with the U.S. government for the expansion project, which is scheduled for completion by 2016. Afterwards, the annual output of ethylene and propylene of Formosa Plastics U.S.A. will top 2.4 million metric tons and 1 million metric tons, respectively, compared with 2.93 million metric tons for ethylene and 2.36 million metric tons for propylene of FPG’s petrochemical complex in Mailiao.
Li Chih-tsun remarked, however, that although petrochemical factories in the U.S. and the Middle East enjoy low production cost for ethylene, due to the use of shale gas and natural gas as the material, respectively, FPG’s petrochemical complex in Mailiao, which uses naphtha as the material, boasts much higher output for a number of petrochemical materials, including propylene, butadiene, and aromatic, which have much higher added value.
(by Philip Liu)
