Formosa Plastics Plans $24 Billion Investment after Project Stalls in China

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Researched by Industrial Info Resources (Sugar Land, Texas)--From now through 2011, Formosa Plastics plans to invest $24 billion in a range of projects with $21.7 billion going into domestic investments and $2.3 billion going overseas to projects in China, the U.S., Philippines and Vietnam. Sectors covered in the investment schedule will be petrochemicals, technology and steel. The projects are subject to government approvals. Currently, a steel mill project awaits regulatory approvals, including those from environmental authorities. Investments of $4.2 billion in steel include $100 million for a stainless steel joint venture in mainland China.

In Taiwan, the group will invest $306 million in the capacity expansion of 12-inch silicon lines amid unconfirmed rumors that it is looking for ventures with international companies, including Norway’s Renewable Energy Corporation in the solar-energy field. In addition to a petrochemical complex in Mailiao, Yunlin County, the group’s Nanya Technology and Inotera Memories plan further expansions. Inotera, a contract manufacturer of dynamic random access memory (DRAM) chips, is a joint venture between Nanya Technology and Germany’s Qimonda AG.

It has been reported that the group’s proposed refinery project in Ningbo, in eastern China’s Zhejiang Province, has been halted by Chinese authorities. “Reasons of industrial security” are said to be behind changes in the set-up of the $10 billion project, with the central government unwilling to cede control of such strategic facilities to non-mainland investors. Initially, Formosa Plastics was set to be the sole operator of an ethylene project due to be launched this year, and the refinery project was to be run jointly with China National Petroleum Corporation (CNPC) or Sinopec. Reports say that the 12 million ton-per-annum ethylene plant will now be controlled by CNPC.

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