Kuokuang Petrochemical Technology Co, which last week was forced to scrap its plan to build a naphtha cracking plant in -Changhua County, yesterday criticized the government’s policy on the petrochemical industry as being inconsistent and unpredictable.
Kuokuang chairman Chen Bao-lang (陳寶郎) said the government lacked an integrated development plan, which had resulted in frequent policy shifts.
“Why wasn’t the government aware that there were valuable wetlands in Changhua?” he asked on the sidelines of a board meeting. “If it was aware, why didn’t it tell us at the very beginning of the project?”
Chen was referring to his company’s plan to build a petrochemical complex in a wetlands area. The project had been under heavy fire for months from environmental and other groups, prior to a decision by the Environmental Protection Administration (EPA) on whether it should be allowed to proceed.
President Ma Ying-jeou’s (馬英九) open opposition to the project was seen as a major factor in the EPA committee’s recommendation that the project either be rejected or conditionally approved.
Chen said environmental impact assessment (EIA) procedures need to be overhauled so that controversial projects can be reviewed more thoroughly and political responsibility can be more clearly defined.
“You can’t expect experts and academics to be responsible for an investment project of this scale,” Chen said. “It’s not fair to them and it’s not fair to us.”
Chen also criticized the policy of leaving it to investors to collect and analyze the environmental and economic data required to obtain approval for investment projects.
This means that a new review has to be conducted each time a company becomes interested in making an investment — a procedure that is both exhausting and unproductive, Chen said.
“The government should use its authority to establish a public database so, whether a project has been approved or not, the related data is available for future reference,” he said.
At the board meeting yesterday, six board members from major investors, including CPC Corp, Taiwan, and Far Eastern Group, formalized the withdrawal of the plan as proposed by CPC last week.
Expressing regret on behalf of the firm’s shareholders, Chen said the company would not be disbanded.
“We have agreed to keep looking for other investment opportunities, both domestically and internationally,” Chen said.
Specifically, the company will be eyeing investment opportunities for higher-value petrochemical production in Taiwan that fits the country’s industrial policy.
Meanwhile, the company will remain committed to producing petrochemicals by searching for possible sites for naphtha cracking plants in other countries.
Despite recent speculation that Kuokuang might move the project to Malaysia or Indonesia, Chen said investors have not yet pinpointed any overseas location.
In addition, he said the company would not need to solicit extra capital, “at least for a while.”
Although several stakeholders raised the issue of compensation at the meeting, Chen quelled speculation that the company might sue the government for delaying, then canceling, the proposed Changhua plant.
“Of course, we investors have been treated unfairly considering the amount of time and money we have put into the project, but considering our chances of winning a lawsuit, we have decided to give up altogether,” Chen said.
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