2nd Petrochemicals Division

A. History

FCFC’s investments under the No. 6 Cracking Project included plants in Mailiao and Haifeng compounds for the production of aroma and its downstream petrochemical materials. During the plant construction stage, three expansion units were in charge of different projects. That is, the 2nd Chemical Division oversaw the construction of Aroma Plant 1, Aroma Plant 2 and SM Plant in charge by the 1st Petrochemical Section; the 2nd Petrochemical Section, directly under the President’s Office took charge of the construction of DMF, PP and phenol plants; the 3rd Chemical Division was responsible for the construction of PTA plant. The phase 1 of the No. 6 Cracking Project was on schedule and completed by the end of 1998. From January 1, 1999 on, a new Plastics Division was set up to take over the production and sales of ABS and PS from the 2nd Chemical Division, while the 2nd Chemical Division changed name to “Petrochemicals Division” to take charge of the expansion of Aroma Plant 1, Aroma Plant 2 and SM Plant.

As the No. 6 Cracking Project entered a new phase, the original expansion units under the project underwent reorganization after July 1, 1999. The 1st and 2nd Petrochemical Sections were dissolved. Plants under their charge were assigned to the respective business division. As a result, the Petrochemicals Division is assigned to take charge of the production and sales of aroma, SM, phenol and acetone, and hence the operations and management of Aroma Pant 1, Aroma Plant 2, SM Plant and Phenol Plant.

The Aroma Plant 1 and SM Plant at Mailiao Area were brought on-stream at the end of 1998 and began to supply petrochemical intermediaries to the affiliated businesses. The SM Plant acquired Lloyd’s ISO-9002 certification in July 1999 and its second-phase expansion is now completed and in operation; the Aroma Plant 2 and Phenol Plant at Haifeng Area have been in operations since July 2000. At present, all products under the Division have received ISO-9002 certification.

As Aroma 3 and SM 3 Plants of Phase 4 Expansion in No. 6 Cracking project shall be completed soon, the manufacture and sales of aromatics are transferred to the new founded 1st Petrochemicals Division since Jun 1, 2006. After adjustment, our operations include SM 1, SM 2, SM 3 and Phenol Plants. The overall investment reaches NT$ 19.8 billions and the number of employee is 288.

Since our establishment, we have been carrying on rationalization in various key elements of operation with perseverance and pragmatic approach. We also endeavor vigorously in environmental protection, work safety, cost reduction, quality and performance enhancement. We work closely with upstream and downstream operations under the No. 6 Cracking Project and aspire to collaborate with other operators in the industry to create a bright future for our petrochemical markets.

B. Major Businesses

The major businesses of 2nd Petrochemicals Division are manufacture and sales of SM, phenol, and acetone. SM is mainly supplied to PS and ABS Plants. Meanwhile, Phenol is mainly supplied to BPA Plants and Acetone is supplied to BPA, Epoxy and MMA Plants. All of these downstream users are parts of Formosa Groups. The products mentioned above are also sold out in the Asian market if the supply is beyond the demand.