Thai polyolefins joint venture partners think big

PTT and SCG chemical units teaming up to create a global top-10 business

Thailand’s petrochemical industry is poised for a major transformation as PTT Global Chemical (GC) and SCG Chemicals (SCGC) join forces in a partnership to create one of the world’s largest polyolefin producers, reinforcing the country’s ambition to become a leading regional petrochemical hub.

The two companies announced their cooperation on Thursday.

The alliance, led by GC chief executive Narongsak Jivakanun and SCGC chief executive Sakchai Patiparnprechavud, combines their olefin and polyolefin businesses in a move designed to strengthen competitiveness, improve operational efficiency and expand access to higher-value global markets.

Once completed, the joint venture is expected to rank among the world’s top 10 polyolefin producers and serve as a driver of Thailand’s industrial development.

Under the proposed structure, GC holds a 56% stake in the new entity, with SCGC owning the remaining 44% through a share-swap arrangement.

The combined operation is projected to have a total olefin production capacity of roughly 7.1 million tonnes per year.

Mr Narongsak said the partnership is expected to generate annual synergy benefits of between US$150 and 200 million, with the full benefits realised within three years of the transaction’s completion.

The companies plan to seek shareholder and regulatory approval during the first half of 2027, with the transaction expected to be finalised in the second half of the year.

A major advantage of the partnership lies in the companies’ neighbouring production facilities in Map Ta Phut, Rayong. By integrating operations, the firms expect to maximise supply chain efficiency, share infrastructure and enhance operational flexibility. Mr Narongsak said the collaboration would elevate Map Ta Phut to Southeast Asia’s premier petrochemical hub by linking world-class production capabilities with advanced R&D resources.

Beyond upstream operations, the alliance is expected to strengthen downstream industries and support Thai small and medium-sized enterprises by providing greater access to advanced materials and enablingthe development of higher-value products for both domestic and export markets.

“This collaboration combines our core strengths and brings together complementary capabilities that will create long-term value for all stakeholders,” he said.

GC contributes expertise in feedstock flexibility and the ability to efficiently process naphtha, liquefied petroleum gas, propane and ethane. The company’s integrated refining business also helps ensure supply security and resilience against fluctuations in global energy markets.

SCGC is recognised for its portfolio of high-value-added products, innovation capabilities and customer-focused development platforms, including its Ideas to Products Center.

Together, the partners aim to expand their presence in fast-growing sectors such as auto manufacturing, solar energy and specialised construction materials, positioning the combined business for sustained growth amid a volatile global market.