UDPATE 1-PTT Chemical cuts 2008 revenue target, plans shutdowns

(Adds quotes, details, bond plans)

BANGKOK, Nov 18 (Reuters) - Top olefins maker PTT Chemical PTTC.BK said on Tuesday it had cut its sales target for this year to 85 billion baht ($2.4 billion) from 99.7 billion baht due to falling petrochemical prices.

Because of a downturn in the petrochemical sector and the impact of the global financial crisis, the company had started shutting some of its plants for maintenance in the fourth quarter, President Veerasak Kositpaisal said.

That was in line with its original plans, although, when prices were higher and margins were good, it had looked at pushing back some of the maintenance.

"With the rapid fall in demand and prices, we have cut our sales target for 2008," Veerasak told reporters after a meeting with analysts.

Veerasak's forecast was lower than an average sales estimate of 93.4 billion baht by 14 analysts polled by Reuters Estimates. It compares with 73.9 billion baht in sales it made in 2007.

The firm had said earlier it would postpone a shutdown of its olefins and monoethylene glycol (MEG) plants until the first quarter of 2009.

But now that petrochemical products have tracked oil CLc1 prices lower, the company had shut three olefins plants, the MEG plant and the plant of its BPE subsidiary, and planned to shut a high-density polyethylene (HDPE) plant for 16 days from Dec. 7, Veerasak said.

"Most of the shutdowns are olefins, which we have closed for maintenance and debottlenecking," he said.

Oil CLc1 has fallen to around $55 a barrel from a July peak of over $147.

After the shutdown, its annual capacity of olefins would be increased to to 2.12 million tonnes from 1.75 million tonnes now.

The production capacity of MEG, a raw material used to make polyester for the textile industry, would rise by 72,000 tonnes from 395,000 tonnes, it said.

PTTCH, a flagship in the olefin petrochemical business of PTT PCL PTT.BK, produces ethylene and propylene, together called olefins, petrochemicals used to make plastic pellets for the packaging and other industries.

HDPE and olefins products each account for a third of sales, while MEG contributes about 15 percent.

PTTCH wants to raise 7 billion baht ($200 million) for investment in 2009, Veerasak said, without giving further details.

As part of that, and of a five-year investment plan, it would sell bonds worth about 10 billion baht to institutions and the public from Dec. 1-3, he said. The bonds, carrying maturities of five and seven years, are scheduled for book building on Wednesday, he said.

The spread between naphtha, a key raw material, and ethylene prices was expected to be $315 a tonne this year and the spread between propylene and naphtha was expected to be $424 a tonne.

The spread between naphtha and HDPE prices was expected to be $630 a tonne this year, Veerasak added.

At the midday break, shares in PTTCH, valued at $1.5 billion, were down 1.43 percent at 34.50 baht, while the broader Thai index .SETI was down 1.28 percent lower. ($1=34.91 Baht) (Reporting by Pisit Changplayngam; Writing by Ploy Chitsomboon; Editing by Alan Raybould)