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Lotte Chemical announces force majeure on ethylene and propylene supplies from Daesan cracker after explosion

March 25/2020

MOSCOW (MRC) -- Lotte Chemical of South Korea has announced an indefinite force majeure on supplies of products from its ethylene cracker in Daesan after an explosion that injured at least 31 people, according to Kemicalinfo.

The explosion occurred on March 4, about 3 am South Korea time from a fire at a compressor unit within the naphtha cracker. The fire has now been extinguished, and investigation to determine the extent of the damage is under way.

The cracker complex along with the 1.1 million ton per year ethylene cracker also produces 550,000 ton per year of propylene and 190,000 ton per year of butadiene. The cracker also feeds an aromatics unit that can produce 240,000 ton per year of benzene, 120,000 ton per year of toluene and 60,000 ton per year of solvent grade mixed xylenes.
Other downstream facilities were also subsequently shut as feedstock from the cracker dries up. These are a 130,000 ton per year of low-density polyethylene, 290,000 ton per year of LLDPE, 500,000 ton per year of polypropylene, 730,000 ton per year of ethylene glycol and 580,000 ton per year of styrene monomer.

The company is yet to announce on when the cracker will restart following this outage.

As MRC reported earlier, Lotte Chemical has shut down its Deasan cracker for maintenance turnaround on October 14, 2019. The cracker resumed production on November 10, 2019. Located at Daesan in South Korea, currently the cracker has an ethylene capacity of 1.1 million mt/year and propylene capacity of 540,000 mt/year.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 215,390 tonnes in the first month of 2020, up by 23% year on year. Shipments of all grades of high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) increased due to higher capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market were 127,240 tonnes in January 2020, up by 33% year on year. ZapSibNeftekhim's homopolymer PP accounted for the main increase in shipments.

Lotte Chemical runs two naphtha crackers in South Korea. One cracker is located in Daesan county in Seosan which can produce 1.1 million tonnes per year of ethylene with the other 1.2 million tonnes per year cracker in the southwestern city of Yeosu.
Author:Margaret Volkova
Tags:PP, PE, LLDPE, homopolymer PP, propylene, HDPE, ethylene, Honam Petrochemical, Lotte Chemical, Russia, South Korea.
Category:General News
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