LG Chem Ltd.’s petrochemical factory in Yeosu, 455 kilometers south of Seoul, is seen in this file photo provided by the company on Nov. 7, 2020.
SEOUL, Oct. 24 (Korea Bizwire) — South Korea’s major petrochemical companies are shutting down their naphtha cracking centers (NCC) for regular maintenance amid a prolonged industrial recession resulting from the global economic slump.
LG Chem Ltd. launched regular maintenance of its NCC at Yeosu in South Jeolla Province late last month.
In general, regular maintenance takes about 40 days, but the company informed its clients that the facility was unlikely to return online until December.
Yeochun NCC Co., a joint venture between Hanwha Solutions Corp. and DL Chemical Co., has been engaged in regular maintenance since the beginning of October, with work expected to wrap up in November.
Korea Petro Chemical Ind Co. also decided to implement regular maintenance for about 50 days from Sept. 13 to the end of next month.
Industry experts suggest that despite the fact that petrochemical companies see their sales drop during maintenance, they decided to extend the period further to minimize the losses stemming from the economic slump.
It seems the more they operate, the more losses they suffer.
According to the Ministry of Trade, Industry and Energy, the spread between the selling price of ethylene and the price of its raw material naphtha stood at US$159.50 on Wednesday, far lower than the break-even point of $300.
Kevin Lee (kevinlee@koreabizwire.com)
