KUALA LUMPUR (June 22): Lotte Chemical Titan Holding Bhd (LCTitan) has awarded contracts worth US$39.79 million and 432.1 billion Indonesian rupiah (around RM303.41 million combined) for the development of an automatic warehouse, as well as bagging area as part of its US$3.95 billion Lotte Chemical Indonesia New Ethylyene (LINE) project in Indonesia.

LCTitan’s subsidiary PT Lotte Chemical Indonesia (LCI) entered into a US$33.59 million (RM147.8 million) purchase order with Lotte Data Communications Co Ltd (LDCC) for the offshore engineering procurement of the automatic warehouse area.

LCI also entered into a separate purchase order worth US$6.2 million (RM27.28 million) with Lotte Engineering & Construction Co Ltd (LEC) for the offshore engineering and procurement of the bagging area.

Additionally, it inked a construction agreement with KINE Project Co for 432.1 billion Indonesian rupiah (RM128.33 million) for the onshore construction of the two facilities.

The contracts fall under related party transactions as LDCC is a 64.95% unit of LCTitan’s indirect shareholder Lotte Corp, while KINE Project is a 70%-unit of LDCC.

LEC, meanwhile, is 43.79%-owned by LCTitan’s major shareholder Lotte Chemical Corp.

Upon completion by 2025, the LINE project has a capacity of 1,000 kilo metric tonnes per annum (KTA) of ethylene and 520 KTA of propylene, among others. Construction is slated to start this year, following work packages awarded since January.  

Shares in LCTitan closed three sen or 1.54% lower at RM1.92 on Wednesday (June 22), giving it a market capitalisation of RM4.44 billion. Year-to-date, the counter has retreated 20%.