LG Chem will make a major investment in order to enhance the structure of its basic material business. LG Chem plans to invest a total of 2.5 billion dollars to extend the Naphtha Cracking Center (NCC) and the Polyolefin each by 800,000 tons.
LG Chem expects that this investment will increase annual sales by 2.66 billion dollars annually. LG Chem has invested 2.31 billion dollars in a 330,000㎡ expansion factory inYeosu, JeollaProvice, and the expanded facilities in the Yeosu factory will produce 800,000 tons of NCC and 800,000 tons of high value-added PO from the second half of 2021.
When the expansion is completed, LG Chem’s NCC production capacity (based on ethylene production) will expand to 3.3 million tons, thus ensuring LG Chem’s No.1 position in Korea.
In the case of the high value-added PO (polyolefin), the company plans to expand its production capacity to 1.8 million tons by 2022 by promoting the conversion to a general-purpose product line simultaneously pushing for extension of production lines by 800,000 tons.
This will lead LG Chem to become Asia’s No.1 and No.3 global company in the high value-added PO sector. “We are trying to secure ethylene for the expansion of high value-added PO business while strengthening profit structure by internalizing basic raw materials such as propylene, butadiene and benzene,” said LG Chem.
LG Chem plans to secure an overwhelming lead in production size and market share over its competitors by increasing the value of high-value-added PO, which currently accounts for about 50 percent of the total PO project, to 75 percent by 2022.
High value-added PO is a polyolefin product based on ethylene and high performance/environmentally friendly catalysts. It is mainly used for functional films, automobile plastic materials, functional shoes, high-porosity pipes, and wire cable coverings.
In particular, the global high value-added PO market is expected to grow more than 7 percent annually, from about 11.5 billion dollars last year to 15.9 billion dollars in 2022.
Meanwhile, LG Chem plans to actively commercialize promising materials. To that end, the company plans to build a new production complex for promising materials on a 240,000-square meter site in the Seokmun National Industrial Complex in Dangjin of South Chungcheong Province.
