PCC and PCG: Joint production of speciality chemicals in Malaysia

PCC SE and Petronas Chemicals Group Berhad (PCG) plan to establish a joint production of speciality chemicals in Malaysia, whereby PCC SE is selling 50 % of the shares in its project company PCC Oxyalkylates Malaysia Sdn. Bhd. (PCC-OM) to PCG. The objective of the 50/50 partnership is primarily to access the markets for oxyalkylates in Southeast Asia (SEA) and Asia-Pacific, allowing the PCC Group to expand one of its core businesses into this growth region. PCC SE established the project company PCC-OM in 2017 with a view to expanding into the Asian region on the back of know-how gained over several decades in the development and production of surfactants and polyols.

With the partnership now established, PCG and PCC SE plan to build an oxyalkylates facility within PCG’s Kerteh (Kertih) Integrated Petrochemical Complex, Terengganu, to produce ethoxylates and polyether polyols. The construction of the facility is targeted to commence in 2021 while production is scheduled to begin in 2023. The partners also intend to establish a joint research and development center at PCC-OM to ensure a high level of innovation and fulfillment of individual customer requirements.

This strategic partnership leverages on the strengths of both companies; PCG as one of the leading integrated chemical players in SEA, and PCC SE with extensive expertise in the production of oxyalkylates, including in particular chemical specialities serving a wide range of industrial applications. The partnership will enable PCC-OM to deliver high value innovative solutions to customers in the oxyalkylates market in the region.

Waldemar Preussner, Chairman of the Administrative Board of PCC SE, stated: “Through this joint venture, we are boosting the expansion of PCC’s core businesses with the Polyols and Surfactants segments in the growth markets of Asia. The Kerteh site is ideal due to the availability of important raw materials and an excellent infrastructure with a direct seaport access, thus ensuring competitive production and logistics costs. This project enables us to leverage on the know-how we have gained from decades of oxyalkylates production and it also provides a pathway for expanding our product portfolio, thanks to the proximity of the new R&D center to customers in Asia. In PCG we have found a strong strategic partner both for this investment as well as for potential further cooperation in the chemicals industry.”

PCG Managing Director/Chief Executive Officer Datuk Sazali Hamzah said: “This is another milestone for PCG in our quest to develop the Group’s speciality chemicals business segment. We are pleased to be working with PCC SE, a global surfactant player, in our first foray into the specialty oxyalkylates market, as their experience, expertise and capabilities provide a strategic fit into our growth plans. We will continue to explore investing in more technologies and assets that will further expand our high-value chemicals portfolio, thus future proofing our business.”

Oxyalkylates are a group of chemicals comprising non-ionic surfactants (ethoxylates) and polyether polyols. Ethoxylates are particularly effective surface-active agents for the manufacture of cleaning, laundry and personal care products and are also used for industrial applications, for example as oilfield chemicals. The PCC Group company PCC Exol SA manufactures these in a portfolio that includes more than 200 different surfactants in all. Polyether polyols serve as feedstocks for the production of polyurethane foams covering a wide range of applications in various industries, including in particular cold-cure foam mattresses and upholstery for the furniture and automotive industries; the PCC Group company PCC Rokita SA is a leading producer of polyols in Eastern Europe.

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