Taipei, June 9 (CNA) Two subsidiaries of the Formosa Plastics Group (FPG) conglomerate said Friday that they have decided to invest US$9.5 billion in the U.S. state of Louisiana.
On the sidelines of an annual general meeting, Formosa Chemicals & Fibre Corp. Vice Chairman Hung Fu-yuan said that his company has decided to team up with Formosa Petrochemical Corp. to build a large petrochemical compound in Louisiana.
The compound will be used to produce ethylene and propylene among other petrochemical products, and commercial production is scheduled to begin in 2023.
The FPG investment in the U.S. market has been anticipated by the market after FPG President Wang Wen-yuan said in an interview published by the Commercial Times in February that the group is considering the feasibility of a broader investment plan, to include the Louisiana plan and possible investment in neighboring Texas.
Hung said that an environmental impact assessment report on the Louisiana investment plan is currently under way, and soon after the report is accepted by state authorities, the project will kick off.
The investment amount of US$9.5 billion will be slightly higher than US$9.4 billion the two companies had previously disclosed to the press in February.
Hung said that the two companies will carry out the investment plan in two phases and that he expects the first phase -- which will include infrastructure investment -- will account for about two-thirds of the total investment.
In February, FPG told the press that the two subsidiaries' U.S. investments are aimed at producing 1.2 million metric tons of ethylene, 600,000 metric tons of propylene, 800,000 metric tons of ethylene glycol and 600,000 metric tons of polypropylene per year.
Currently, FPG's Formosa Plastics Corp. and Nan Ya Plastics Corp., two other major units of FPG, operate two ethylene plants in Texas, with a third one under construction. The group invested US$6 billion in the state from 1980 to 2011, according to media reports.
In the shareholder meeting, a proposal was approved for Formosa Chemicals & Fiber to issue NT$5.6 (US$0.19) in cash dividend per share for its 2016 earnings per share of NT$7.50, which rose from NT$4.72 recorded in 2015.
