Thai giant SCG to invite global tech giants to jointly invest in Vietnam petrochemicals complex: exec

Thailand-based conglomerate SCG, a leading industry group in ASEAN, will seek leading global tech partners to jointly invest in its $5.2 billion Long Son Petrochemicals Complex (LSP) in Vietnam, says its president and CEO Thammasak Sethaudom.

At a Monday meeting with Vietnamese Prime Minister Pham Minh Chinh in the southern province of Ba Ria-Vung Tau, where the complex is located, the SCG leader provided an update on the Long Son project and reported on its investment expansion plans.

He thanked the Vietnamese Government, ministries, and Ba Ria-Vung Tau province authorities for their support in clearing challenges and obstacles.

PM Chinh said the Vietnamese Government is interested in the Long Son petrochemical complex project. He noted that upon receiving SCG's information, he had instructed Deputy PM Tran Hong Ha to immediately hold a meeting with provincial authorities and direct relevant agencies to promptly address SCG's requests, towards restructuring the project effectively.

For the proposal related to procedures to attract leading global technology partners to join the project, the PM assigned the Ministry of Planning and Investment to work with the provincial People's Committee and relevant agencies on studying and guiding necessary procedures, ensuring regulatory compliance.

He affirmed that the Government, ministries, and Ba Ria-Vung Tau province are committed to facilitating SCG's projects in Vietnam, based on the principle of harmonizing benefits and sharing risks.

SCG specializes in cement and construction materials, packaging, and petrochemical products. It is running 27 subsidiaries in Vietnam, with total investment exceeding $7 billion.

It commenced land preparations for the Long Son Petrochemicals Complex in 2018, started up all utilities in 2022, and conducted a full complex test run in December 2023.

LSP began its commercial operation (COD) on September 30, with an initial production output of 74,000 tons during the trial phase. At full capacity, the complex’s annual output will include 1.4 million tons of polyethylene and polypropylene.

At a working session with Deputy PM Tran Hong Ha in October, SCG said the unfavorable global market had caused production costs to outnumber selling prices and supply to exceed demand.

“The LSP plant has temporarily halted operations to manage overall business costs, with plans to reassess operations when conditions are more favorable,” it added.

The LSP is “closely monitoring” the market situation and will adjust the run rate of its operation during this challenging period for petrochemical business, the company noted.

In reply, Ha asked relevant ministries to study SCG's recommendations on the basis of “shared risks and benefits” and ensuring fair trade ties between Vietnam and other countries.

He asked the Ministry of Finance to discuss and draft feasible solutions regarding import-export taxes to ease difficulties for the Thai group.

SCG recorded a revenue of THB36.71 billion ($1.08 billion) in Vietnam in the first nine months of this year, up 14.7% year-on-year. According to the group's performance review for the period, Vietnam was its biggest market in ASEAN, excluding Thailand as its home market.

SCG said its Long Son Petrochemicals Complex (LSP) made an earning of negative THB2.19 billion ($64.6 million) in Q3/2024, following negative THB2.2 billion in Q2/2024 and negative THBB2.62 billion in Q1/2024. The figure did not include a non-recurring financial gain from unwinding the interest rate swap (IRS) at THB2.18 billion ($64.4 million).