Lotte Chemical to invest $502 mn in eco-friendly materials plants in Korea

South Korea’s Lotte Chemical Corp. is set to spend 602 billion won ($501.5 million) in building eco-friendly materials plants at one of its petrochemical complexes in the country.

Lotte said on Monday it agreed with a local government to invest in a battery electrolyte organic solvents factory as well as carbon capture and utilization (CCU) facility at its petrochemical complex in Daesan, about 140 kilometers southwest of Seoul.

“This investment is a key step in ‘Green Promise 2030’ to expand eco-friendly and specialty chemical materials such as battery electrolyte organic solvents and carbon dioxide capture projects,” Lotte’s basic materials business head Hwang Jin-gu said in a statement.

ELECTROLYTES ORGANIC SOLVENT PLANT, CCU FACILITY

Lotte plans to build a plant to produce organic solvents - high-purity ethylene carbonate (EC) and dimethyl carbonate (DMC) – for electrolytes, a key material for lithium-ion batteries. South Korea totally relies on imports for organic solvents that make up about 30% of the electrolytes’ total cost.

The company decided to set up a facility that captures and liquefies 200,000 tons of carbon dioxide with a target of commercialization in the second half of 2023. The carbon dioxide processed in the facility will be used as materials for the high-purity EC and DMC, as well as sold as materials for semiconductor cleaning liquid.

In addition, Lotte will expand the production capacity of ethylene oxide adduct, a high-value-added construction material, to 480,000 tons a year from 330,000 tons.

Meanwhile, Lotte plans to triple liquefied petroleum gas (LPG) use for ethylene production at the Daesan complex as the domestic industry rushed to diversify feedstock for cost-cutting amid expectations of lower naphtha supply from local refineries, which aim petrochemical markets.

It will ramp up LPG cracking at the complex to about 30% from the current 10%.

That is a part of the company’s plan to increase LPG usage announced in July 2021, a company source said. At that time, Lotte said it will invest 140 billion won in domestic facilities to raise the gas usage for ethylene output to 40% by the end of this year from 20%. It operates ethylene plants in Daesan and Yeosu with a combined annual capacity of 2.3 million tons.

Write to Jeong Min Nam at peux@hankyung.com
Jongwoo Cheon edited this article.