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FEATURES CEO INTERVIEW

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PTTGC partners with Myriant on bio-succinic platform

DORIS DE GUZMAN NEW YORK

The nation’s strategic goals are driving flagship chemical company, PTT Global Chemical, to invest in renewables

Green chems for Thailand

Through a series of recent investments, Thailand’s largest petrochemical company, PTT Global Chemical (PTTGC), has established itself as a

global player in bioplastics and renewable chemicals while spearheading the country’s ambitious program to become a regional green technology hub.

PTTGC announced in October its 50% ac-quisition of US polylactic acid (PLA) plastic producer NatureWorks for $150m (€110m) from US agribusiness firm Cargill. Nature-Works plans to build a 300m lb/year PLA plant in Thailand that is expected to start op-erating in late 2015. In January, PTTGC in-vested $60m in US-based biosuccinic acid producer Myriant Technologies.

A key business plan of PTTGC is to become a major player in bio-based chemicals, says CEO Veerasak Kositpaisal.

“Our core business is petrochemicals, but we also want to grow within the green chemi-cals space, as it promises to have a very good future, especially in Thailand, where we have abundant supply of agricultural feedstock at very competitive prices,” he says.

Since 2006, the Thai government has pursued the development of a bioplastic industry be-cause of its great potential for consumption of agriculture raw materials, particularly cassava and sugarcane. Thailand has annual produc-tion of more than 30m short tons of cassava and 80m tons of sugarcane.

“When we look at the bioplastic volume re-quired, the production capacity of the agricul-

tural products needed and the feedstock costs, sugar and cassava are the leading feedstock candidates given their domestic abundancy,” Kositpaisal says. “Today, we export these commodity products and we plan to use about 10–20% of the export volume to convert them into PLA plastic. We have done the evaluation and found that the project looks good.”

Plentiful biomass resources translate to sta-bility and competitive raw materials for the

bioplastic industry, according to PTTGC.Thailand is already one of the top three

plastic exporters in Asia and one of the largest resin producers in the world, according to Thailand’s National Innovation Agency (NIA), which is part of the Ministry of Science and Technology. In 2008, NIA was provided fund-ing of Thai baht (Bt) 1.8bn ($58.5m, €42.6m) to pursue bioplastics innovation projects and research and development under the govern-ment’s National Roadmap for the Develop-ment of the Bioplastics Industry.

Thailand offers various incentives to create an investment-friendly atmosphere for the bi-oplastics industry. One tax incentive features corporate-income-tax exemption for up to eight years and an additional 50% reduction of corporate income tax for five years.

Both PTTGC and NatureWorks are in dis-cussions with the Thai government concern-ing incentive packages as well as government promotion for the use of bioplastics.

“The government of Thailand has been very supportive in value-added initiatives and tax incentives for the new PLA production site here in Thailand,” Kositpaisal says. “Tax incentive is one thing but the supporting poli-cies in bioplastic promotion – that will also come into the future.”

RENEWABLE CHEMICALS GOALSPTTGC, the chemical flagship of Thailand’s industrial conglomerate PTT Group, has been entrusted with leading the development of a broader biobased chemicals business not just bioplastics, Kositpaisal said.

Kositpaisal says that PTTGC’s investment in Myriant is a strategic entry point not only for the Thai company to accelerate the com-mercialization of biobased products in Southeast Asia but also to strengthen its competitive advantage in biobased chemi-cals manufacture.

Myriant is building its first commercial bio-succinic acid facility in Louisiana, US, funded with partial support from the US Department of Energy (DOE) and the Louisiana state gov-ernment. The plant has a capacity of 30m lbs/year (14,000 tonnes/year) and is scheduled to start at the end of 2012.

With Myriant, PTTGC says it is looking to be able to manufacture a variety of drop-in biobased chemicals such as succinic acid and derivatives such as butanediol, lactic acid and derivatives, acrylic acid and fumaric acid.

“We believe in the competitiveness of Myri-ant’s technology,” Kositpaisal says. “Right now, we are sending our people to work at the Myriant site, including sales, marketing and researchers, to reflect our plan and our com-mitment in Myriant.”

“Thailand has been very supportive in value-added initiatives and tax incentives”VEERASAK KOSITPAISAL CEO, PTT Global Chemical