This year’s outlook for Formosa Petrochemical Corp (FPCC, 台塑石化) is not as good as expected because of the worldwide macroeconomic slowdown, chairman Chen Bao-lang (陳寶郎) said at the company’s annual shareholders’ meeting yesterday.
However, Formosa Petrochemcial expects overall sales of its oil and petrochemical products to increase 20 percent this year from last year, Chen said.
He said the company expects this year’s ethylene and propylene output to rise 20 percent to 3.025 million tonnes and 2.409 million tonnes respectively.
Because all the oil-refining facilities have been revamped and operations are in full swing, total sales of gasoline should reach 5.988 billion liters and diesel should reach 10.378 billion liters this year, with the combined sales expected to grow 20 percent from last year, the company said in a forecast.
Last year, Formosa Petrochemical’s crude oil processing capacity was 385,000 barrels a days, down 11 percent from 433,000 barrels the year before, and the domestic sales of oil products totaled 5.701 billion liters, down 3 percent from the year before, company data show. Overseas shipments of oil products were 13.583 billion liters last year, down 9.2 percent from 2010.
“The year 2011 was a year of setback for Formosa Petrochemical,” Chen said, citing the impacts of the eurozone debt crisis, China’s tight monetary policy, weak US economic recovery and low consumer confidence.
In addition, fires at the company’s refinery in Mailiao Township (麥寮), Yunlin County, in July last year and the subsequent suspension of operations in part of the plant caused losses in the third quarter and hardship in the fourth quarter, Chen said, as well as the resignation of former chairman Wilfred Wang (王文潮).
Because of the fires, production of ethylene and propylene were 2.534 million tonnes and 1.930 million tonnes last year, down 12 percent and 13.5 percent respectively from the previous year, company data show.
Formosa Petrochemical will increase the number of self-service pumps at domestic gas stations to attract more consumers, and will continue to push oil exports to Southeast Asia, Africa and the Middle East, Chen said.
The company also plans to invest in a butyl rubber plant in Ningbo, Zhejiang Province, and a steel plant in Vietnam, he said.
When asked if Taiwan should have more oil refiners, Formosa Plastics Group (FPG, 台塑集團) chairman William Wong (王文淵) said he welcomed more competitors joining the market so that Formosa Petrochemical and state-run CPC Corp, Taiwan (CPC, 台灣中油) would no longer be considered a duopoly.
However, he warned that the threshold for getting into the refinery business is high since the investment is huge, and said that even there were one or two more refiners, all the firms’ prices would still be about the same because of the free market mechanism.