South Korean petrochemical makers are racing to upgrade their naphtha cracking facilities to cash in on resurgent demand for plastics in Asia, led by China as per Reuters. LG Chem will raise its Daesan naphtha cracker capacity by about 100,000 tpa in March 2011 bringing its total cracking capacity to 1.9 mln tpa. This expansion at the country's No. 2 petrochemical maker will bring its total capacity on par with top ethylene maker YNCC. Samsung Total will raise its capacity by nearly 18% to 1 mln tpa in 2011. It's 850,000 tpa cracker will be shut in May for about 45 days for upgrading. The higher cracking capacities from LG Chem and Samsung Total will add around 750,000 tpa of naphtha demand from South Korea, keeping the market for the petrochemical feedstock in a healthy mode. By 2012, Honam Petrochemical - the current No. 3 ethylene maker, may even replace YNCC and LG Chem as number one if it decides to move ahead with plans to raise total cracking capacity to 2 mln tpa from 1.75 mln tpa.
Current healthy petrochemical margins have prompted South Korea's top oil refiner SK Energy to restart a 200,000 tpa cracker after a two-year shutdown. This has boosted the overall sentiment for naphtha feedstock. LG Chem will shut its Daesan cracker, currently with a capacity of around 800,000 tpa, for about 45 days starting end-March for maintenance and expansion works. Cracker capacity at Daesan is being planned to be expanded by 100,000 tpa. YNCC has no plans to expand its capacity next year, but will shut the largest of its three crackers for maintenance - its 857,000 tpa cracker in Yeochun for about a month starting early April. Its other two crackers will not undergo maintenance in 2011.