The Ministry of Economic Affairs yesterday slammed Formosa Plastics Group (台塑集團) over its latest industrial mishap, saying it was considering imposing a severe penalty pending an investigation into Thursday’s fire.
The group, one of the nation’s largest industrial conglomerates, saw a fire break out at its petrochemical complex in Mailiao (麥寮), Yunlin County, at 8:40pm on Thursday. The fire was not put out until early yesterday morning.
Industrial Development Bureau Director-General Woody Duh (杜紫軍) demanded the group improve safety and beef up measures to prevent such incidents from recurring.
Citing US chemicals group Dupont and Germany’s Bayer Group as examples, Duh said Formosa Plastics Group should also be able to improve safety, judging from its solid finances, strong technologies and ample talent.
However, the group has been plagued by a string of incidents since last year, which has not only tarnished its corporate image, but also incurred huge costs from compensating affected residents and paying fines to the government, he said.
“Thursday’s incident yet again showed the group’s incompetence in improving industrial safety. Its leadership must take full responsibility in overhauling safety measures,” Duh said.
The Yunlin County Government slapped the group with an initial fine of NT$2 million (US$69,500) over the latest fire, while ordering a probe into its cause.
In October last year, group member Nan Ya Plastics Corp (南亞塑膠), the nation’s largest plastics maker, saw one of its four factories in Chiayi County engulfed in a fire that broke out from the control room.
This followed two incidents in July at its affiliate, Formosa Petrochemical Corp (台塑石化), the nation’s only publicly traded oil refiner.
The refiner halted operations at its No. 1 ethylene plant, which has an annual capacity of 700,000 tonnes, on July 7 after a fire. It again shut down the plant after an oil leak triggered a fire at its No. 2 residual desulfurization unit on July 25.
Formosa Plastics Group chairman William Wong (王文淵) yesterday made a public apology over the repeated mishaps.
The group said it was still looking into the cause of the fire, which was suspected to have been caused by a rupture in the complex’s raw material supply pipes.
It said the gasoline leak would not endanger the lives of residents near the complex because it wasn’t toxic and there were no black fumes polluting the air.
The operation of three of the group’s petrochemical plants was suspended over safety concerns.
The group said operations should resume within a few days and losses were expected to be “minimal given sufficient inventory.”
According to the Central News Agency (CNA), the shutdown could cost the group losses of about NT$216 million per day.
“As long as crude oil prices continue to hover around US$100 per barrel or even higher, these petrochemical companies will generate handsome revenue that will reduce the impact of the fire,” Hua Nan Securities (華南永昌證券) analyst Henry Miao (苗台生) told CNA.
Shares of Formosa Plastics Corp (台塑), the group’s flagship company, fell 0.9 percent to NT$114 yesterday on the Taiwan Stock Exchange, while those of Nan Ya Plastics dropped 1.2 percent to NT$83.
Formosa Chemicals and Fibre (台灣化學纖維) slid 1.4 percent to NT$108, while Formosa Petrochemical closed flat at NT$100.