Petrochemicals

Lotte Chemical and GS Energy to set up petrochemical joint venture

Lotte Chemical and GS Energy to set up petrochemical joint venture
Photo courtesy of Lotte Chemical

Lotte Chemical Corp. is adding a chemical compound plant in its petrochemical complex in Yeosu, South Jeolla Province, South Korea. The plant will be completed by the end of the year through a joint venture with GS Energy Corp., an energy specialized holding company of the GS Group.

The two Korean companies signed the agreement this week to create a joint venture, tentatively named Lotte-GS Energy Company, which will specialize in producing chemical compounds like bisphenol A (BPA) and C4 fraction. BPA is a key material for polycarbonate plastics used in electronics and medical products while C4 fraction is a chemical compound used for making butadiene (BD) and tert-Butyl alcohol (TBA).

Lotte Chemical would hold a 51% interest in the new entity, with GS Energy owning the rest. The two firms plan to jointly invest USD 678.7 million through 2023 to build a plant capable of producing 200,000 tons of BPA and 210,000 tons of C4 fraction products a year. The joint venture will also enhance the price competitiveness of its polycarbonates. 

The plant represents a significant economic endeavor as Lotte Chemical says the joint venture is expected to post USD846 million in sales and USD85 million in operating profit, while also creating 7,700 jobs.

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