Thailand's largest petrochemicals maker PTT Global Chemical (PTTGC) plans to invest $11 billion by 2020 to expand production capacity, with a focus on high-margin speciality and green products, its chief executive said.

Speciality chemicals - high-value raw materials used to produce a wide range of consumer products - are a growing market for petrochemical makers striving to increase profit margins and to differentiate themselves from competitors.

Asia's growing middle class, especially in China and India, are driving spending on consumer products, while Thailand, a car manufacturing hub in Southeast Asia, should increase demand for the high-grade chemicals, PTTGC Chief Executive Anon Sirisaengtaksin told Reuters in an interview.

"This clearly indicates that the speciality market will offer strong growth and higher margins than commodity-based markets," said Anon, a former executive at the country's top oil and gas explorer PTT Exploration and Production.

High-volume specialties and green products are expected to contribute about 30-40% of the company's revenue in the next 10 years, up from about 10% now, he said.

The petrochemical flagship of PTT group aims to double revenue to $37 billion by 2020 from about $17 billion in 2011, partly through the move towards high-value products Anon said, adding that 2012 revenue would be close to that of last year.

PTTGC, which has an annual capacity of 291,600 tons of speciality products, mainly phenol and bisphenol, in June bought a 51% stake in Perstorp Holding France, which will be renamed Vencorex Holding.

The Perstorp acquisition will allow PTT Global to make polyurethane, used in foam and coatings in the auto and construction industries.

The company has also signed a deal with Malaysian state oil company Petroliam Nasional Bhd (Petronas) and Japan's Itochu Corp to build two petrochemical plants.

Anon said he expected a final decision on the investment in the middle of next year.

PTTGC, 49% owned by top energy firm PTT, plans to invest 17 billion baht ($540 million) this year, including 9.4 billion baht to buy stakes in U.S-based NatureWorks, the world's largest polylactic acid maker, and Perstorp Holding.

The company plans to use technology from Nature Works to develop the bio-plastic industry in Thailand, where petrochemical demand is expected to grow in line with the country's economy.

"Thailand has high potential to become a bio-plastic hub given that we have a number of agricultural products such as sugar that can be developed for green chemicals," he said.

PTTGC has an annual capacity of 979,500 tons of green chemicals, mostly oleochemicals used in personal care products.

New cracker planned

The $11 billion investment plan also includes $3 billion to build a planned olefins cracker with an estimated annual capacity of 1 million tons, Anon said.

He said the company was seeking a location for the new cracker to serve growing demand in Asia, especially from China, Indonesia and Vietnam, and was also looking at building a new bio-plastic plant in the next five years.

"We have not been affected much (by the slowdown in China). They are likely to bargain on some prices, but we think demand is still there," he said, adding that 50% of the company's annual output of 1.59 million tons of plastic pellets was sold to China.

Formed in October 2011 through the merger of PTT Chemical and PTT Aromatics and Refining, PTTGC has an olefins and aromatic petrochemical capacity of 8.26 million tons per year, and a crude oil refining capacity of 280,000 barrels per day.

Concern about the impact of Europe's debt crisis on demand has led PTTGC, one of the world's top 10 ethylene makers, to review its investment plans, said Anon, and this year the focus would be on maximising the benefits from the merger and to "de-bottleneck" existing facilities to lift production.

The latter move, expected to be completed by 2014, should boost output of plastic pellets by 70,000-80,000 tons per year, he said.

"For projects that yield high returns and do not need a lot of investment, we will go ahead. But for new projects that we haven't committed to, we still have time to consider," Anon said, adding that the company had no major acquisition plans this year.

Shares of PTTGC have fallen 16% in the past three months, underperforming a 0.3% drop in the broad market , mainly due to concern that earnings and margins could be hit by weak demand for paraxylene, one of its main products.