SCG Chemicals plans extra $400 mln investment in Vietnam petrochemicals complex

Long Son Petrochemicals Company (LSP), a wholly-owned subsidiary of Thailand’s SCG Chemicals, plans to invest an additional $400 million in its petrochemicals complex in Vietnam's southern province of Ba Ria-Vung Tau.

The intention was revealed by Long Son Petrochemicals' general director Kulachet Dharachandra at a meeting with Prime Minister Pham Minh Chinh on Thursday.

The firm expects the Vietnamese government to provide more tax incentives and streamline procedures to facilitate the expansion of the Long Son complex, the executive stated. He also asked for approval to use imported ethane as an input material.

In response, PM Chinh emphasized that Vietnam has been working to simplify procedures and ensure a stable, long-term supply of imported gas from the U.S., contributing to meeting the energy demands of the Long Son project.

He said that next week, relevant agencies will complete procedures related to the project investment expansion.

Regarding the company's tax proposal, Chinh said that export and import taxes should fit the situation and encourage high-tech, large enterprises to invest in Vietnam.

The cabinet leader assigned Deputy Prime Minister Ho Duc Phoc to direct agencies to promptly consider Long Son Chemicals' proposal and respond to it. "If the Government is not the decision-maker, it will report to the National Assembly at the next session."

SCG Chemicals started land preparation for the Long Son petrochemicals complex in 2018, started up all utilities in 2022, and conducted a full complex test run in December 2023.

The complex has a total investment of $5.2 billion and a designed annual capacity of 1.4 million tons of polyethylene and polypropylene, making it the largest foreign-invested project in Ba Ria-Vung Tau.

In October 2024, SCG said the Long Son complex “temporarily halted operations to manage overall business costs, with plans to reassess operations when conditions are more favorable.” According to the provincial government, the complex is planning to resume operation in early Q3/2025.

In its 2024 performance review, SCG Chemicals recorded a loss of THB10,269 million ($303.6 million) from the Long Son complex last year.

The investor said Long Son expenses are mainly depreciation and interests. As a result, SCGC posted a loss of THB7,990 million ($236.2 million) in 2024 (before elimination of intersegment transactions), versus a profit of THB589 million in 2023.

For 2025, SCG Chemicals estimates Long Son’s monthly total expenses can reach THB1,200 million ($35.5 million), of which 40% is non-cash, such as depreciation.