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Announcement: Cancellation of the Elastomers Project

4/14/2016

Subsequent to the Bursa Malaysia announcement made on 3  November 2015 on the acquisition from PETRONAS Refinery and Petrochemical Corporation Sdn Bhd (PRPC), a wholly owned subsidiary of Petroliam Nasional Berhad (PETRONAS), the entire equity in three (3) companies, namely PRPC Glycols Sdn Bhd, PRPC Polymers Sdn Bhd and PRPC Elastomers Sdn Bhd (“Project Companies”), which are part of the Refinery and Petrochemicals Integrated Development (RAPID) project in Johor Malaysia , PCG wishes to announce that it will not proceed with the proposed elastomers project in RAPID.

The decision was based on a review which was conducted on various key aspects of the elastomers project, including the product’s market outlook and project return on investment. The project cancellation is expected to improve the overall returns of PCG’s investments.

As per the 3 November 2015 announcement, the initial total projected investment cost for the polymers, glycols and elastomers segments was approximately USD3.9 billion with a combined capacity of 3.5 million metric tons per annum (mtpa). The cancellation of the elastomers project will result in capacity reduction of 0.35 million mtpa and projected investment cost by USD1.3 billion.

PCG remains committed to the rest of the petrochemical projects that it had undertaken, namely the polymers and glycols projects. The cancellation of the elastomers project is not expected to have any impact on the commencement date for PRPC Polymers and PRPC Glycols which is scheduled to start in 2019.

Announcement in Bursa Malaysia

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