Mon, Mar 10, 2014 - Page 13 News List

FPCC says oil production lower this month

By Camaron Kao  /  Staff reporter

Formosa Petrochemical Corp (FPCC, 台塑石化) said it could see its oil production decline about 10 percent this month from last month because of a pipeline accident in Yunlin County’s Mailiao Township (麥寮) on Wednesday and maintenance scheduled for its equipment this month.

The company’s oil production this month is to decline to 480,000 barrels a day from 532,000 barrels a day last month, company president Tsao Mihn (曹明) told reporters on Thursday.

As a result, the company’s revenue for this month may not post sequential growth from NT$85.45 billion (US$2.83 billion) last month, which had fewer work days because of the Lunar New Year holiday, Tsao said.

Sales of oil account for 65 percent of the company’s revenue, he added.

Part of the company’s desulphurization equipment has been shut down because of a hydrogen leak that was caused by an accident during examination of the company’s pipeline on Wednesday, Tsao said, adding that he expects it would take a week to fix the problem.

“After the repairs have been made, we also have to keep the utilization rate for residue desulphurization equipment low for a while this month, since part of the equipment is newly installed,” Tsao said.

Furthermore, the company’s reduced crude conversion and residue desulphurization equipment will be under annual maintenance for three months starting at the end of this month, Tsao said.

The scheduled maintenance will drag down the company’s revenue this month and cause a sequential decline in revenue next quarter, Tsao said.

In comparison, Formosa Plastics Corp (FPC, 台塑), the nation’s largest maker of polyvinyl chloride and the flagship company of the Formosa Plastics Group (FPG, 台塑集團), said its revenue next quarter would be higher than this quarter.

The utilization rate of the company’s factories would be 92.6 percent next quarter, up from 88 percent this quarter, company president Jason Lin (林健男) said.

The demand for polyvinyl chloride has been high this month and the company expects sales of the product will rise further next quarter as the weather in the US improves and construction activities rise in that country, Lin said.

According to Lin, sales of the company’s other products will also surge next quarter from this quarter because of more scheduled maintenance for factories in the region and rising demand in China starting this month.

Revenue of Nan Ya Plastics (南亞塑膠), the nation’s largest plastics maker and another main unit of the group, will also be higher next quarter than this quarter.

Nan Ya chairman Wu Chia-chau (吳嘉昭) said its new factories making glass cloth and copper foil in Kunshan, in China’s Jiangsu Province, started operations this month and will contribute to its revenue next quarter.

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