Petronas has taken a drastic step to shut down and close a number of petrochemical factories around Malaysia, its country of origin, as the demand of polymers and chemical materials weakens.
Several of Petronas petrochemical plants in Kerteh (Terengganu) and Gebeng (Pahang) had been shut down for indefinite period.
The plants were mainly involved in the production of polyethylene, which is commonly used in the manufacturing of plastic packaging, food wrappings as well as parts for vehicles and the automotive industry.
Some of Petronas factories in Gebeng, Pahang operate through partnership with BASF Group, currently the world’s largest chemical company. Recently, BASF, a German company, announced its plan to shut down 80 of its plants worldwide, including those in Malaysia.
Lack of orders from its customers caused the inventories to pile up and the company decides to halt the material production while watching the market reaction. A big bulk of orders for chemical material from Petronas plants come from the US and Europe, and as the US financial crisis and the credit crunch are hitting hard, many companies are closing down business, or stopping operation in order to stay afloat.
There is a lot of bad news announced almost everyday.
No wonder everyone is panic
It’s an obvious sign of recession, despite the positive quarterly GDP growth.
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This is a very not true story, the article mentioned “Several of Petronas petrochemical plants in Kerteh (Terengganu) and Gebeng (Pahang) had been shut down for indefinite period” is totally bogus. A plant may reduce its production or shutdown for a few days when demand is low but no Petronas plant has been shut down indefinetely. One plant in Gebeng is producing additives for the petrol that we use so unless suddenly all Malaysian stop pumping petrol, then only the plant will shut down. Don’t simply take the news as true just because it appears here in the blog