LOTTE Chemical Titan Holding Berhad (“the Company”) announced today that its Indonesian subsidiary, PT LOTTE Chemical Indonesia (“LCI”), will be signing the engineering, procurement and construction (“EPC”) contracts for Group A work package as part of the Company’s new integrated petrochemical facility in Indonesia, known as the Lotte Chemical Indonesia New Ethylene (“LINE”) Project whereby Onshore Construction Contract is signed with PT HEIN Global Utama, a joint venture between Hyundai Engineering Co., Ltd. (“Hyundai”) and PT Hans Enjiniring dan Konstruksi whilst Offshore Engineering and Procurement Contract is with Hyundai. The said EPC works will comprise construction of a Cracker plant with the capacity to produce, amongst others, 1,000 kilometric tonnes per annum (“KTA”) of ethylene and 520 KTA of propylene. The total contract value of Group A EPC work package is approximately USD 757.2 Million, which is equivalent to RM 3.1 Billion.
At the same time, LCI will also be signing the EPC contracts for Group B and Group C work packages for the LINE Project, covering works for the downstream plants and other infrastructure facilities, whereby Onshore Construction Contract is signed with LOTTE Engineering & Construction Co., Ltd. (“LEC”) and PT Jaya Teknik Konstruksi and the Offshore Engineering and Procurement Contract, with LEC. The Company had earlier secured approval from its minority shareholders to award the two work packages to affiliated-party LEC through an Extraordinary General Meeting held on 16 December 2021.
“With the latest development, all the pivotal aspects of the construction of the Indonesia LINE Project (i.e. the Cracker, downstream plants, infrastructure facilities and etc.) are now in place and we are set to commence the full project construction this year and the project will be slated for completion by 2025,” said its President & CEO, Mr. Park Hyun Chul.
The Company has said earlier that it is commencing construction of the large-scale LINE expansion project in Merak, Cilegon, Banten Province, Indonesia. The LINE Project, with investment value in the range of USD 3.95 Billion (approximately RM 17 Billion), is a joint venture with its parent company, LOTTE Chemical Corporation, and will serve as the key expansion drive for the Company with the aim to solidify its position as a top-tier petrochemical company in the Southeast Asia region upon its completion.
“Moving ahead, our Company will continue to focus on operational and financial performance optimization initiatives amidst the highly volatile and mercurial external environment. We will continue to be vigilant and explore value-accretive opportunities to further drive our growth. At the same time, we shall remain steadfast to focus on our key growth strategies to achieve our vision of becoming a top-tier petrochemical company in the Southeast Asia region,” President Park further reiterated.