SCG Shifts Strategic Direction to Address New Challenges: Russia-Ukraine Situation, High Energy Costs, Inflation, Highlighting Flexibility Strategy and Closing All Risks, Increasing Alternative Energy Proportion and Moving Forward with High Potential Investment Projects

Roongrote Rangsiyopash, President and CEO of SCG, announced the company’s business direction for 2022 in response to numerous uncertainties in global situations, including the COVID-19 pandemic and the Russia-Ukraine situation which have resulted in higher energy and feedstock costs in a range of industries, besides inflation and long-term crises such as global warming.

To address the challenges promptly, SCG has devised the following strategies:

The short-term strategy centered on two approaches: 1) Closing all risks, in which the company manages energy costs and supply chain by preparing sufficient feedstock and keeping it at a reasonable cost, purchasing energy futures contracts, and maintaining proper financial cost management; and 2) Remaining flexible and adaptable by closely monitoring the cost situation of energy and feedstock influenced by market dynamics to ensure that the business strategy can be altered in a timely manner while minimizing customer impact.

Furthermore, the long-term strategy will be guided by two approaches: 1) Accelerating ESG 4 Plus (Set Net Zero, Go Green, Reduce Inequality, and Embrace Collaboration) implementation in business operations, particularly increasing the proportion of renewable and alternative energy usage; developing low-carbon products with the goal of reaching net zero by 2050; and 2) Adapting investment plans to the circumstances, such as moving forward with the integrated petrochemical complex Long Son Petrochemicals Company Limited (LSP) in Vietnam, which has already achieved 91% of its planned progress (as of the end of 2021) . The project will begin commercial operations in the first half of 2023. In addition, new investment projects that impact the long-term usage of funds will be reviewed.

“SCG believes in its ability to meet the challenges it is now confronting. We have learned a lot from the crisis, such as the COVID-19 pandemic during the last two years. As a result, this year, we are confident that we can adjust the way we work and streamline the organization to be more flexible and agile, with business operations tailored to keep up with the situation, most notably the soaring energy and feedstock prices that are driving SCG to transition to alternative energy. Although this is not easy, we intend to achieve net zero using the ESG approach that gives us confidence that we can pull it off. At the same time, we will continue to care for our customers, partners, communities, and all stakeholders to remain strong and grow in a sustainable manner along with improving the quality of life to strengthen the economy and reduce social inequality,” said SCG President.

Published on: Mar 17, 2022

 

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