HANOI, Feb 27 (Reuters) - Vietnam's Long Son

Petrochemicals, a unit of Thailand's SCG Chemicals, is lobbying

Vietnam to impose tariffs on imported polyethylene and

polypropylene, as operations at its new $5.4 billion

petrochemical complex remain suspended due to low margins.

"LSP is actively collaborating with relevant Vietnamese

government agencies to expedite the proposal for applying tariff

and non-tariff measures on PE and PP to protect domestic

producers," the company told Reuters in an emailed statement

late on Wednesday.

Polyethylene and polypropylene are raw materials that are

used to make daily-use plastics such as bags and containers.

Last November, Siam Cement, Thailand's largest industrial

conglomerate and owner of SCG Chemicals, suspended operations at

the Long Son Petrochemicals complex after only one month due to

"the chemicals' low margin".

LSP said it was focused on maintaining the facility, but

said market conditions remained unfavourable.

"The petrochemical business situation is still in a low

cycle amid a volatile global economy," it said. "Therefore, LSP

is closely monitoring market conditions to make a prompt

decision about resuming operations when the market becomes

favorable."

LSP said it would invest $500 million to incorporate ethane

as an additional feedstock for the complex, and expected the

upgrade to be completed by 2027.

Companies are building more crackers in Asia to process U.S.

ethane, which is cheaper than naphtha.

In its statement, LSP said it had signed a 15-year ethane

supply agreement with an affiliate of U.S. gas supplier

Enterprise Products Partners ( EPD ).

It said it had an agreement with Mitsui O.S.K. Lines ( MSLOF ) for the

long-term charter of three Very Large Ethane Carriers, and was

seeking to secure another two charters of ethane carriers.

The LSP complex in southern Vietnam has annual capacity to

produce 500,000 tons of high-density polyethylene, 500,000 tons

of linear low-density polyethylene and 400,000 tons of

polypropylene, using mostly naphtha and propane as raw materials

imported from the Middle East.