Thailand’s SCG Chemicals Q4 net loss widens on LSP depreciation
Pearl Bantillo
30-Jan-2025
SINGAPORE (ICIS)–Thai conglomerate Siam Cement Group’s (SCG) chemicals operations incurred a wider Q4 net loss of baht (Bt) 3.40 billion ($101 million) on account of poor performance from its subsidiary Long Son Petrochemical (LSP) in Vietnam.
in million Thai baht (Bt) | Q4 2024 | Q4 2023 | % change | 2024 | 2023 | Yr-on-yr % change |
SCG Chemicals revenue | 58,982 | 46,259 | 28% | 210,298 | 191,482 | 10% |
SCG Chemicals EBITDA | 1,436 | 2,449 | -41% | 7,363 | 13,696 | -46% |
SCG Chemicals net profit | -3,403 | -2,560 | 33% | -7,990 | 589 | – |
Group Sales | 130,512 | 120,618 | 8% | 511,172 | 499,646 | 2% |
Group EBITDA | 15,178 | 10,924 | 39% | 53,946 | 54,143 | 0% |
Group profit for the period | -512 | -1,134 | -55% | 6,342 | 25,915 | -76% |
LSP’s non-cash depreciation in Q4 was Bt3.27 billion, SCG said in a presentation to analysts on Thursday.
Operations at its petrochemical complex in Ba Ria-Vung Tao province in southeastern Vietnam were halted indefinitely from mid-October 2024 amid poor production economics.
Vietnam’s LSP is a wholly owned subsidiary of SCG Chemicals (SCGC), the petrochemicals arm of SCG.
For 2025, SCG estimates LSP’s monthly total expenses to be about Bt1.20 billion, of which 40% is non-cash depreciation.
SCG is working towards diversifying the feedstock of LSP’s cracker via an ethane enhancement project, whose estimated cost was reduced to $500 million, from $700 million previously, and will be funded internally.
The project is expected to be completed in end-2027.
It noted that ethane is about $250/tonne cheaper than naphtha, the main feedstock used in Asia for petrochemical production.
LSP is a flexible cracker which can run on up to 70% gas – either propane or ethane – in its feedstock mix, SCG said.
In line with the project, SCG has signed a 15-year deal with the US’ Enterprise Products Partners for supply of up to 1 million tonnes/year of ethane on a free-on-board basis.
A time charter of the same duration was also signed with Japanese shipping firm Mitsui OSK Lines for the transport of the gas feedstock.
LSP’s ethane enhancement project will include the building of two specialized tanks with specialized storage of minus 90 degree Celsius, SCG said.
With the addition of ethane as feedstock, “SCGC’s total feedstock pool will be more balanced and competitive”, it said, noting that gas – ethane, propane, LPG (liquefied petroleum gas) – will be for global competitiveness, while naphtha is for “operational ease and creation of HVA [high value-added] by-products”.
In the first half of 2025, SCG said that capacity additions, margin pressure and weak demand in the olefins and vinyl sectors will continue to weigh on the petrochemical industry.
($1 = Bt33.78)
Thumbnail image: Thailand Chonburi Laem Chabang Port – 24 January 2022 (Xinhua/Shutterstock)
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