Lotte Chemical to invest US$215 mln for ethylene capacity expansion

13-Dec-16

South Korea's Lotte Chemical Corp plans to invest US$215.82 mln to increase ethylene production capacity at the Yeosu plant by 2018, as per Reuters. The expansion plan comes as the South Korean government has called on Korean petrochemical companies to sharpen their competitiveness amid growing competition from China. The petrochemical maker plans to start construction in H1-2017 and expects to boost its annual sales to about US$426.48 mln in 2019 when it aims to begin commercial operation of the expanded plant.

"The move is to establish a sustainable growth foundation by ensuring stable procurement of feeds tock and by expanding production capacity," the company said in a filing to the stock exchange. Lotte Chemical also said the expansion plan will increase the ethylene production at its Yeosu plant by 200,000 tpa to 1.2 MMtpa by 2018 and propylene production by 100,000 tpa to 620,000 tpa. The company said the expanded plant will use propane gas to produce petrochemical products, shifting away from traditional petrochemical feedstock such as naphtha in order to diversify raw materials and stay cost competitive by using ethane from Uzbekistan natural gas and U.S. shale gas.