Malaysian producer Petronas Chemicals Group (PCG) has announced it will not proceed with a proposed elastomers plant that was to be part of the Refinery and Petrochemicals Integrated Development (RAPID) project in Johor. The decision was based on a review of various key aspects of the project, including the market outlook for the products it was to produce and the project’s return on investment, the company said.

Last November, PCG said the initial investment costs for the polymers, glycols and elastomers projects at RAPID, which had a combined capacity of 3.5 million t/y, were about $3.9 billion.

The cancellation of the elastomers plant will result in a capacity reduction of 350,000 t/y and a cut in the projected investment of $1.3 billion. The company said it remains committed to the polymers and glycols projects.

PCG acquired from Petronas Refinery and Petrochemical Corp (PRPC) three companies that are participating in RAPID - PRPC Glycols, PRPC Polymers and PRPC Elastomers. PRPC Polymers and PRPC Glycols are scheduled to start in 2019.