Formosa Petrochemical Corp (台塑石化), Taiwan’s only publicly traded oil refiner, said it will increase production capacity amid the economic recovery.
The refiner plans to expand its crude oil processing capacity to 593,000 barrels a day in the next three years, chairman Wilfred Wang (王文潮) said yesterday.
The company is seeking government approval to increase its capacity further to 720,000 barrels a day, he said. Formosa Petrochemical, based in Yunlin County’s Mailiao (麥寮), has capacity to process 540,000 barrels of crude oil daily.
“We will expand production capacity to boost competitiveness,” Wang said at the company’s annual shareholders’ meeting in Taipei. “Over the long term, the economy is heading in the right direction.”
The company’s cost for refining a barrel of crude oil is between US$5 and US$5.50, spokesman Lin Keh-yen (林克彥) told shareholders, without giving any comparison data.
Formosa Petrochemical climbed 1.6 percent to NT$82.50 in Taipei trading before the meeting. The benchmark TAIEX index rose 0.8 percent.
Meanwhile, Formosa Plastics Group (台塑集團) chairman William Wong (王文淵) yesterday expressed disappointment that the petrochemical sector has not been included on the “early harvest” list under a proposed trade pact with China.
He urged the government to pay more attention to old-economy industries and continue efforts to support the sector by winning consensus with China to include the petrochemical sector on Taiwan’s list of items and services that will enjoy tariff waivers or easier market access should the proposed economic cooperation framework agreement (ECFA) be signed.
Taiwan and China wrapped up the third round of ECFA negotiations on Sunday and reached consensus on the context of the pact, including the “early harvest” list of each side.
A government official, who requested anonymity, said earlier this week that polyvinyl chloride and polypropylene had been excluded from the “early harvest” list.
Formosa Petrochemical’s Wang said the government cannot afford to ignore the petrochemical sector any longer, as the nation’s rivals, such as South Korea and Japan, are expanding their production capacities.
He said South Korea has boosted its annual ethylene production to 7 million tonnes, while Taiwan can produce just 4 million tonnes a year.
He said some members of ASEAN, including Thailand and Singapore, were also expanding their ethylene production capacities.
Formosa Petrochemical operates three crackers that can process naphtha or liquefied petroleum gas into ethylene and propylene, chemicals found in plastics and polyester fabrics. The plants have the ability to produce 2.94 million tonnes of ethylene a year.
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