Lotte Daesan advances petchem expansions to H1 2008 from H2
South Korea's Lotte Daesan Petrochemical has brought forward an extensive expansion of its integrated petrochemical complex at Daesan, which is now slated for completion in the first half of 2008, a company source said Thursday. The previous target was the second half of 2008.
Lotte is set to expand its naphtha cracker's ethylene capacity to 1 million mt/year from 650,000 mt/year. Its propylene capacity would be hiked by 175,000 mt/year to 500,000 mt/year. Lotte would be consuming all its additional olefins output towards its production of polypropylene, linear low density polyethylene, styrene monomer and monoethylene glycol.
The firm plans to increase its styrene monomer production capacity from 335,000 mt/year to 470,000 mt/year. Its PP capacity will be hiked from 227,000 mt/year to 300,000 mt/year, and it LLDPE capacity would increase from 160,000 mt/year to 290,000 mt/year.
Lotte is scheduled to start up a new 390,000 mt/year MEG plant by the second half of 2008, which would boost the company's total MEG capacity to 640,000 mt/year. Lotte would also raise its benzene capacity to 320,000 mt/year from 200,000 mt/year.
Lotte is owned by Honam Petrochemical. It is also the marketing agent for Honam and KP Chemical's BTX produce.
S Korean Honam Petchem to build, invest in $2.6 bil Qatar plant
South Korea's Honam Petrochemical said Thursday it has reached a deal to build a $2.6 billion plant in Qatar with a subsidiary of the state-run Qatar Petroleum.
Under the deal, Honam Petrochemical will invest $390 million to have a 30% stake in the joint project, with Qatar Intermediate Industries Holdings Company controlling 70%, the company said in a filing to the local stock
The plant, which will start production by the second half of 2011, will produce up to 700,000 mt/year of polypropylene, 600,000 mt/year of styrene monomer and 220,000 mt/year of polystyrene, it said.
Ethane and naphtha will be supplied by Qatar Petroleum for the petrochemical plant.
The two companies, which concluded a preliminary deal in December 2005 for the project, plan to set up a joint venture in early 2008 for the construction of the complex in Mesaieed, south of Doha.
"Honam Petrochemical is the first South Korean petrochemical company to advance into the Middle Eastern petrochemical market," the company said in a statement, saying the deal would help the company secure cost competitiveness using low-priced natural gas.
Honam Petrochemical is a unit of South Korea's family-run conglomerate Lotte Group which also owns Lotte Daesan Petrochemical and KP Chemical.
S Korean Lotte Group working toward merger of three petchem firms
South Korean conglomerate Lotte Group is looking to merge three of its petrochemical firms into a single entity, sources close to the plan said this week. Two of these -- Lotte Daesan and Honam Petrochemical -- operate naphtha crackers and downstream petrochemical plants. The third, KP Chemical, produces aromatics and synthetic fibers, among other products.
Sources at two of the firms confirmed that negotiations were underway and that a merger was possible by the end of 2008. "We are aiming to complete the merger in January 2009, but it seems possible for us to establish the new firm at the end of next year," said a source.
Lotte Daesan's naphtha cracker in Daesan has ethylene and propylene production capacities of 650,000 mt/year and 335,000 mt/year respectively, while Honam operates a cracker in Yeochon that is able to produce 720,000 mt/year of ethylene and 370,000 mt/year of propylene.
Both companies have planned to debottleneck their crackers by the end of next year. Honam plans to increase its ethylene production capacity by 30,000 mt/year later this year, while Lotte Daesan plans to expand its ethylene capacity to 1 million mt/year.
Considering Honam and Lotte Daesan's expansion plans, a merged entity together with KP Chemical would have a total ethylene production capacity of 1.75 million mt/year, surpassing the 1.72 million mt/year capacity of South Korea's current largest ethylene producer, Yeochon Naphtha Cracking Center.
KP Chemical, based in Ulsan, has a yearly capacity of 200,000 mt of paraxylene, 40,000 mt of orthoxylene, 23,000 mt of benzene and 6,000 mt of toluene from one plant. At another plant, it is capable of producing 500,000 mt/year of paraxylene, 150,000 mt/year of orthoxylene, 70,000 mt/year of benzene and 14,000 mt/year of toluene.
KP Chemical Corp., an affiliate of South Korea’s Lotte Group
KP Chemical is the largest producer of purified isophthalic acid (PIA) in Korea. The company is a recognized leader in the export of petrochemical products with around 95 percent of its products, including PIA, going to China, Japan, Hong Kong, Taiwan, Russia, Europe and the U.S.
South Korea's Lotte Daesan testing new polypropylene plant
South Korea's Lotte
Daesan Petrochemical has started to produce on-spec polypropylene
from a new 300,000 mt/year plant at Daesan, which began
commissioning two weeks ago, a company source said Tuesday.
The plant is slated to start commercial operations from early September. It was fed propylene for the first time on July 15, and now sources the eedstock from Lotte's steam cracker, which can yield 500,000 mt/year of the monomer.
In addition Lotte has inked a long-term tolling agreement to draw 80,000 mt/year of propylene from Samsung Total Petrochemicals Co from September.
Samsung Total is due to start commercial operations at a new 200,000 mt/year propylene plant or olefins conversion unit at Daesan, possibly from early September.
Lotte's new PP plant raises the company's total PP capacity to 550,000 mt/year. As Lotte and Honam Petrochemical merged their sales, marketing and purchasing divisions last month, the merged entity has displaced Polymirae as the largest PP supplier in South Korea by capacity.
Honam has two PP plants at Yeosu which can produce 380,000 mt/year.
Polymirae has the capacity to produce 650,000 mt/year of PP at Yeosu.
Lotte and Honam are tipped to fully merge in January 2009. Lotte Daesan is wholly owned by Honam and their core products of olefins, polyolefins and aromatics are complementary. Industry sources have said the merged company was likely to take on Honam's name, however there has not been a formal announcement.
S Korea's Lotte Daesan, Honam to complete merger January 2
petrochemical affiliates Honam Petrochemical and Lotte
Daesan Petrochemical are
slated to fully merge by January 2, 2009, Honam's spokesman
Son-Joo Kim said Wednesday.
The companies initiated a partial merger in June this year, joining their sales, marketing and purchasing divisions.
Lotte Daesan is wholly owned by Honam and their core products of olefins, polyolefins and aromatics are complementary. However, their manufacturing facilities are at different sites, with Lotte's at Daesan on the country's southeastern coast and Honam's in Yeosu on the southern coast.
Earlier this year industry sources said they expected the merged entity to take Honam's name, as it was generally thought that the Lotte brand was associated with too many other industries outside of petrochemicals. Kim declined to comment on this Wednesday, saying "it is not determined yet".
Korea's Lotte Group has a 57% share in Honam, with the remaining 43% of shares floating free on the Korea Stock Exchange.
Honam also has a 52% controlling share in another local petrochemical company, KP Chemical, which produces benzene, orthoxylene, paraxylene, meta-xylene, phthalic anhydride, dioctyl phthalate, purified terephthalic acid and iso-phthalic at Ulsan. The Korea Development Bank and Woori Bank have 8.7% and 8.4% stakes in KP, respectively, and the rest of shares are listed on the Korean bourse.
The Lotte Group's other business interests include confectionery, beverages, retail distribution, restaurants, hotels, construction and entertainment facilities.