Published March 17, 2009

More petrochem giants move HQs here

Mitsubishi Chemical is the latest company to set up a HQ; joining Huntsman and Borouge, among others

By RONNIE LIM

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(SINGAPORE) Singapore has become the address of choice for international petrochemical and chemical producers.

Qatar Petrochemical Company is opening a trading office here this week to further grow its sales of low density polyethylene.

More of them are setting up their operational headquarters here to better serve Asian markets. The latest name on this list is Japan's Mitsubishi Chemical which will move the HQ for its terephthalic acid (or TPA) business from Tokyo to Singapore in June.

Qatar Petrochemical Company (QPC) is also opening a trading office here this week to further grow its sales of low density polyethylene to South-east Asia.

They follow others like American chemicals giant Huntsman which earlier this month announced it was relocating the global HQ for its textile effects division from Switzerland to the Republic also around mid-year - after having earlier shifted its performance products HQ here. The latest move means that about a dozen of Huntsman's top brass will move here.

Last month, Borouge - a joint venture between Abu Dhabi National Oil Company and European plastics provider Borealis - also said that it was setting up its regional logistics hub here to handle increased exports to Asia, including from its new petrochemical complex.

'We expect to see more such petrochemical HQs coming here,' a Singapore official indicated to BT.

Mitsubishi Chemical said that it was shifting its HQ for TPA to the Republic because most of its TPA business is now being conducted in Asian countries outside Japan. Demand for TPA - used to make end-products like polyester fibres, and polyester films - has, on the other hand, been falling in Japan, it added.

Under its reorganisation, the group plans to move the TPA HQ to Singapore in June, and its technology operations to India, where a state-of-the-art TPA plant, currently under construction, is expected to start up by end-June.

A Mitsubishi Chemical spokesman, contacted in Tokyo yesterday, said the group had not yet decided on the number of HQ personnel being relocated here, nor the capital investment in the HQ.

Currently, its TPA HQ in Tokyo employs about 20 employees, he said, adding that the group could consider moving operational HQs for other units here in future.

The Japanese chemicals giant said that its policy is to have TPA production sites where the customers are located, namely Indonesia, India, China and South Korea.

Its biggest plant is in Yeosu, South Korea which is producing 1.7 million tonnes per annum (tpa), with India becoming its second-largest production site with 1.27 million tpa once the new plant there starts up mid-year.

Because of falling domestic demand, Mitsubishi Chemical also plans to shut its 250,000 tonnes TPA plant and another 100,000 tonnes paraxylene unit in Japan by end-2010.

Separately, Qatar's Deputy Prime Minister and Minister for Energy and Industry Abdullah Hamad Al-Attiyah will be here tomorrow to inaugurate QPC's new Singapore trading office. He is also chairman of QPC - a joint venture of Qatar Industries and Atofina of France.