KUALA LUMPUR: Petronas Chemicals Group Bhd (PCG) has entered into a strategic partnership with LG Chem Ltd to build a nitrile butadiene latex manufacturing plant at Pengerang Integrated Complex (PIC) in Johor.
The integrated chemicals producer said the partnership was timely amid a period where the demand for nitrile gloves was growing rapidly.
"In addition, the collaboration will create new revenue streams and unlock new markets by optimising resources in both companies.
"At the same time, PCG and LG Chem will work together to offer various grades and new applications of NBL as well as develop high-value added products through continuous research and development (R&D) and investments," PCG said.
Construction of the plant will begin in 2021 while production is scheduled to start in 2023.
"When completed, the plant will have an annual NBL production capacity of 200,000 tonnes," it said.
PCG managing director and chief executive officer Datuk Sazali Hamzah said the partnership marked a strategic step in developing its specialty chemicals portfolio, underpinning its position as a leading integrated chemicals producer in Malaysia.
Sazali said the partnership also provided a compelling entry point into the growing NBL-based products and enabled PCG to enhance its presence in attractive end-markets, especially for personal care and healthcare, mainly in Asia Pacific.
"This collaboration further strengthens the pursuit of our growth agenda, having acquired a silicone player last year.
"With more specialty chemicals in our portfolio, we are moving into segments with higher growth potential," he said.
NBL is a synthetic rubber that uses butadiene as the main feedstock and is a core raw material for making nitrile gloves, which is widely used in industries such as healthcare, medical, and food, among others.
Recently, the use of nitrile gloves had seen rapid growth in helping to prevent the spread of Covid-19 and other infections.
The rising demand of nitrile gloves is at an annual average of more than 10 per cent and is expected to account for 70 per cent of the entire latex gloves market in 2024.