Lotte Chemical partners with GS Energy to set up petrochemical joint venture
SEOUL, AJU - Lotte Chemical, a major chemicals company in South Korea, partnered with GS Energy, an energy service provider, to set up a joint-venture petrochemical plant for Bisphenol A (BPA) and C4 oil products.
The two companies agreed to set up a joint venture in the second half of the year, with 51 percent owned by Lotte Chemical and 49 percent by GS Energy. The new joint venture will invest 800 billion won ($679 million) by 2023 to build a plant capable of producing 200,000 tons of BPA products and 210,000 tons of C4 oil products annually.
BPA is a starting material for the synthesis of plastics, primarily certain polycarbonates and epoxy resins. BPA-based plastic is made into a variety of common consumer goods, such as plastic bottles, CDs, and DVDs. Epoxy resins containing BPA are used to line water pipes, as coatings on the inside of food and beverage cans and in making thermal paper such as that used in sales receipts.
C4 oils are used to produce butadiene, a synthetic rubber material, and tertiary-butyl alcohol (TBA), a synthetic marble material, through extraction with hydrocarbon compounds.
Lotte Chemical will use BPA to increase the price competitiveness of polycarbonate products and expand its C4 oil business. “We are continuously pushing to optimize our product portfolio to actively respond to changes in the petrochemical industry environment and strengthen our business competitiveness,” Lotte Chemical CEO Lim Byung-yeon said in a statement.
Lotte Chemical, a unit of South Korea's fifth-largest conglomerate, is expanding its investment abroad, especially in Southeast Asia. In March, Lotte Chemical Rep Director Lim Byung-yeon hinted at making an additional investment in Pakistan.
GS Energy said that through the joint venture, it can strengthen its business portfolio in the petrochemical sector. “We expect the joint venture will serve as an opportunity to strengthen the competitiveness of the energy business while diversifying its business portfolio,” said GS Energy CEO Huh Yong-soo.