PTT chief executive Pailin Chuchottaworn said the company has set a strategy to 'go green' with its ambition to be a premier multinational energy company in four years. It wants to be known as an advanced technology and green national oil company.
"In the next few years, we will see a biorefinery that uses agricultural products as raw materials, not crude oil, at Map Ta Phut Industrial Estate. Thailand will be the first country to have a biorefinery," he said.
He said the global market is moving in this direction. Bioplastics will replace old plastics just like flat-screen TVs replaced box TVs in a short period.
PTT must charge ahead into bioplastics if it wants to take the lead.
It has two bioplastic products in the pipeline: polybutelene succinate (PBS) and polylactic acid (PLA). They are plastics made from raw sugarcane or cassava starch that are 100% biodegradable in less than a year in the right temperatures.
PBS will be handled by PTTMCC Biochem, a 50:50 joint venture between PTT and Mitsubishi Chemical Corporation.
The plant is under construction at Map Ta Phut Industrial Estate with an investment of US$100 million and a capacity of 20,000 tonnes per year. Production is scheduled to start in the first quarter of 2015, generating revenue of 3 billion baht per year with over 80% expected to come from exports.
The PLA business is a joint venture between PTT Global Chemical and NatureWorks of Cargill. NatureWorks has one PLA plant in the US and is considering whether to build a second plant in Thailand or Malaysia. The second PLA plant will require investment of $150 million for a capacity of 140,000 tonnes per annum.
PBS is plastic used to coat paper and compostable bags as well as products related to farming, and it will soon replace polypropylene. PLA is used to produce absorbable sutures or screws to connect artificial bones, as well as compostable tea bags.
"The two products [PLA and PBS] shall give PTT Group a competitive advantage in engineering bioplastic products and compounding a variety of them to meet customer needs," said Mr Pailin.
PTT Group also makes green ABS products, engineering plastics produced by IRPC.
Bioplastics are not widely used in Thailand, used instead in developed countries. But they have the potential to grow by 27% per year and replace traditional plastics, which are only growing at 5-6%.
Mr Pailin said PTT plans to migrate from commodities plastics to special plastics for a higher margin of 10-20% over the next five years.