Lotte Chemical, whose profitability has deteriorated due to business slump, has been hit by the bad news of an explosion. The accident-prone Daesan plant is expected to suffer significant losses as its ethylene production, called "rice of petrochemicals," reaches 1.1 million tons.
According to Lotte Chemical on March 4, seven factories were suspended due to an explosion at Lotte Chemical's Daesan plant in Seosan, South Chungcheong Province, at 3 a.m.
An accident occurred during the process of naphtha decomposition for ethylene and propylene manufacturing, and the exact cause of the accident is being investigated.
The production capacity of ethylene at the Daesan plant stands at 1.1 million tons, accounting for 26.7 percent of the total ethylene production capacity of Lotte Chemical. Last year's sales amounted to 3.3 trillion won, or 21.8 percent of the total consolidated sales. The operating profit related to the Daesan plant is estimated to be around 326 billion won, or 29.7 percent of the total.
As production was halted due to a fire at the NC plant, a total of seven plants, including six factories with the connected processes, were shut down. The suspended plants include NC, BTX, BD, PE and PP. The remaining six plants are in normal operation.
Industry insiders and outsiders cautiously predict that it will take some time to get it up to normal. Compressor facilities, which are presumed to have been involved in an accident, are the most important facilities of the NCC, which serve to heat raw materials and move compressed gas.
