Thailand's largest industrial conglomerate said on Wednesday it had signed a deal with state oil firm Qatar Petroleum International to invest in a Vietnam petrochemical complex worth up to $4 billion.

The project, delayed by the global economic crisis, is part of Siam Cement's drive to become one of Southeast Asia's leading petrochemical producers.

President Kan Trakulhoon said cost of the project could be reduced from a previous estimate of about $3.5-4.0 billion because the economic situation had changed.

'It is likely that it should be reduced,' Kan told reporters on the sidelines of a seminar.

The global economic recovery would also make it easier for Siam Cement and its partners to secure financing, Kan said.

This week, Prime Minister Abhisit Vejjajiva was in Qatar to tighten relations between the two countries and witness the signing ceremony of the deal.

Vietnam state oil monopoly Petrovietnam and Vietnam National Chemical Corp would hold a combined 29 per cent of the project. The rest would be held by non-Vietnamese partners including Siam Cement and Qatar Petroleum.

Kan said it was likely that Siam Cement and Qatar Petroleum would hold 25 per cent each, while Siam Cement subsidiary Thai Plastic and Chemicals would own 16 per cent and a Japanese trading firm would hold 5 per cent.

Qatar Petroleum would provide feedstock for the complex, which includes a 1.4 million tonnes olefins cracker that is highly flexible between gas and naphtha feedstock and will be fully-integrated into downstream products, a Siam statement said.

The investment would also cover infrastructure such as shipping ports, a power plant and storage facilities, it said.

Further details would be released in mid-2010, it added.

The company was in the process of accessing financing for the complex in the southern province of Ba Rai Vung Tao, near a third refinery in Vietnam.

In March, Siam Cement said the project would be delayed for at least two years because the global financial crisis had made it difficult for the company and its partner, Petrovietnam, to finance the project.

Apart from the petrochemical complex in Vietnam, Siam Cement also delayed two cement projects in Indonesia and Cambodia.     The first part of the project had been expected to be completed in 2011 and the second in 2013.

On Wednesday, Siam Cement shares closed up 2.8 per cent at 218 baht, in line with a 2.9 per cent rise of the overall market. – Reuters