UAC banks on alternative energy demand
Universal Adsorbents & Chemicals (UAC), an importer and distributor of adsorbents and other chemical products, will invest Bt300 million in an alternative-energy project to tap an expected increase in demand.
The company plans to invest in alternative energy sources such as liquefied petroleum gas (LPG), compressed natural gas (CNG) and natural gas liquid (NGL) after studying a gas-utilisation project, director Chatchaphol Prasopchoke said. UAC has received a letter of intent from a foreign company that was granted a concession to process crude oil and gas in Sukhothai province, to negotiate the construction of a separation plant to produce various types of gas from the by-products of crude oil processing.
“The company has conducted a study on this. These types of gas usually come together with crude, and can be used to make LPG and CNG,” he said.
The project is expected to commence late in the third quarter of next year and to generate revenue of about Bt200 million per year. The project’s engineering design has been completed.
UAC posted Bt78.50 million in net profit for the first nine months of this year, up from Bt63.67 million in the same period of last year. Its third-quarter net profit was Bt17.51 million, down from the same period of last year after a shortage of palm oil resulted in a decline in profit sharing from Bangchak Biofuel Co Ltd (BBF), as well as lower gross profit margins on some products.
The company expects sales to reach its target for the rest of this year on forecast revenue growth of 13-15 per cent in 2011. Despite expectations that Thailand’s economy will slow due to the floods and the euro-zone debt crisis, the energy and petrochemical sectors continue to expand, as seen in the rising crude price, which now stands above US$100 per barrel. This situation is expected to be helped by unusually cold weather this winter, Chatchaphol said.
UAC is concentrating on on-time delivery of products and a reduction in its inventory to increase cash in hand for investments next year. Its sales plan aims at developing new products like environmentally friendly refrigerants and chemicals used in butter production and fat acids.
Despite escaping direct flood damage, the BBF plant in Ayutthaya province was forced to halt operations due to logistics problems. The plant is expected to resume production in late November after the floods recede, Chatchaphol said.
UAC’s head office on Vibhavadi-Rangsit Road was affected by the floods, but has been able to continue normal operations with the help of existing inventory and advance product purchases. Its Rayong office and Bangpoo warehouse are receiving purchase orders and delivering products as planned.
