Singapore's ChemOne delays Pengerang complex's start to 2028 (updated)

PEC

16/12/2024 12:16

(Updates with CEO comments)
       SINGAPORE, Dec 16 (Reuters) - Singapore's ChemOne Group
has delayed the start of its Pengerang Energy Complex (PEC) to
the fourth quarter of 2028, with construction set to begin by
mid-2025, it said on Monday, after securing more financing for
the project. 
    The project has secured an agreement for $3.5 billion of
financing, the company said.
    "As the petrochemicals industry is set to grow
exponentially, alongside rapid economic development across East
Asia and Southeast Asia, the PEC project is poised to form a key
driver of demand for quality aromatics in the medium to long
term," Alwyn Bowden, PEC's chief executive, said.
    The $5 billion project's start has been delayed multiple
times in the past few years after it was first announced in
2020.
    "The PEC project has faced many challenges on its path to
fruition, including living through the COVID restrictions and
the various geopolitical impacts of both the Ukraine war and the
more recent conflicts in the Middle East, all of which have
conspired in creating a complex financing environment for all
projects," Bowden said. 
    The "complexity working with five export credit agencies as
well as three Islamic entities" also resulted in a "degree of
unpredictability" and timeline adjustments of the project, he
added. 
    Earlier this year, ChemOne Group awarded the operations and
maintenance contract for the PEC site to a subsidiary of GS
Engineering & Construction Corp  006360.KS .
    When completed, the site is expected to house a
petrochemical facility that can produce up to 2.6 million metric
tons per annum (mtpa) of products such as paraxylene, a
feedstock for synthetic fibres and plastic bottles, and 3 mtpa
of fuel products including jet fuel. 

 (Reporting by Trixie Yap. Editing by Sonia Cheema and Mark
Potter)
 ((trixie.yap@thomsonreuters.com;))