Ammonia Manufacturer
HU-CHEMS, a fine chemical manufacturer in Korea, has started to build a chemical plant worth 1 trillion won (US$856 million) in Malaysia, becoming the only ammonia producer in the nation.
The chemical company affiliated with Taekwang Industrial announced that it had a groundbreaking ceremony on July 29 for its chemical plant at Bintulu in Sarawak, Malaysia, situated on the northwest of Borneo.
HU-CHEMS is going to build a facility that can produce 600,000 tons of ammonia, 400,000 tons of nitric acid, and 200,000 tons of ammonium nitrate by investing around 1 trillion won in the 33,578 square meter complex. The firm is scheduled to select a constructor for the plant by the first half of next year, complete the construction by 2018, and start producing chemicals in the first half of 2019. It is planning to increase the production of ammonia to up to 1 million tons.
The fine chemical producer plans to finance 250 billion won (US$214 million) of starting capital and mobilize the rest of the 1 trillion won via investment.
Once the construction is completed, HU-CHEMS will become the only local ammonia manufacturer. Korea has imported 1.4 million tons of ammonia each year from Indonesia, Australia, and the Middle East since 2000, when local companies gave up manufacturing the raw material due to the loss of competitive advantage in the business.
The company is currently considering whether or not to inject additional 1 trillion won into the construction of a factory that produces polyurethane, synthetic fibers, and fertilizers, using the materials collected in processing the upstream stage.
If HU-CHEMS carries out the project in the upstream and downstream stages, vertical integration that encompasses the production of raw materials and the production of finished goods will be possible. Product competitiveness is expected to be further strengthened through the economy of scale.