Over the decades, development of the Taiwanese petrochemical industry from the downstream to upstream has created close interdependency of the upper, middle and down-stream businesses.  This unique industrial environment allow the petrochemical industry in Taiwan to achieve great stature within a short time, contributing to the prosperity of Taiwan.  However, as time passes by, the upstream businesses faltered to expand their production capacity alongside local demand.  Long term shortage of basic petrochemical raw materials has made the mid and downstream businesses suffered and turned them to rely heavily on import.  The supply and demand gap is such that the Taiwanese domestic production capacity of basic raw material ethylene can only meet 38% of the domestic demand.  Seeing how this imbalance will erode the competitiveness of the local petrochemical industry and impact the development of other related industries,  the Formosa Plastics Group has proposed to undertake the No.6 Naphtha Cracking Project, also as an effort to secure sufficient source of ethylene and other essential petrochemical raw materials, and further the Group's strategy of vertical integration and product diversification.  Members of Formosa Plastics Group led by Formosa Plastic Corporation, Nan Ya Plastics Corporation, and Formosa Chemicals & Fiber Corporation have joined force to establish Formosa Petrochemical Corporation.   Formosa Petrochemical Corporation ("Formosa Petrochemical')  is designated to perform a sizable portion  the planning, designing, construction, and the operation of of this huge expansion project.  This project includes an integrated refinery with an annual nameplate processing capacity of 21 million metric tons (450,000 barrels per day) of crude oil, two naphtha cracking plants with a combined annual nameplate processing capacity of 1.6 million metric tons, and three co-generation plants with a total electricity generation capacity of 1.82 million kilowatts. The total investment made by Formosa Petrochemical on this project is approximately US$7.4 billion.  Upon the project completion, the annual production capacity of ethylene has increased the local supply dramatically, meeting more than 90% of the demand and resolved the long-term shortage problem.  As such that the domestic petrochemical market has became more stable and the relative industries more competitive.

     Since the beginning of the construction, Formosa Petrochemical has always been highly attentive in the area of environmental protection and pollution control.  Formosa Petrochemical's refinery and naphtha cracking plants not only use advanced process technologies producing products that meet local governmental regulations and international standards, but also adopt best available control system for environmental protection.  For the year ended December 31, 2003, Formosa Petrochemical's spent US$12.5 million on its environmental protection efforts.  All the discharge and emission from Formosa Petrochemical's factories have met the most stringent pollution control standards since their operations in 1999.

     In addition to the company's good track records, Formosa Petrochemical is continuously undertaking improvement projects, such as implementing the ISO 14000 system, to enhance environmental control.  These efforts reflect Formosa Petrochemical's goal in achieving  zero-pollution.  Meanwhile, on the research and development front,  Formosa Petrochemical is always evaluating the latest refining technology to further improve product quality through reduction of  sulfur contents.  Formosa Petrochemical is always looking for best business practices and aiming to achieve "equal care for the business and environment".