MOSCOW (MRC) -- South Korea’s Lotte Chemical has delayed the restart of its fire-hit naphtha-fed steam cracker in Daesan for the second time to mid-November, from October, reported S&P Global.
It had initially planned to restart the cracker in September.
"The restart has been moved back to mid-November, but could be delayed again," a company source told S&P Global Platts. Lotte Chemical has plans for the cracker to operate as per normal by the end of 2020.
As MRC wrote before, the cracker was shut on March 4 following an explosion, which injured more than 30 people.
Lotte Chemical has two steam crackers. The company's other steam cracker in Yeosu is currently running at more than 100% of capacity due to positive petrochemical margins.
The company last purchased 50,000 mt of naphtha for H2 August delivery to its Yeosu steam cracker, at a premium of around USD21/mt to the Mean of Platts Japan naphtha assessments, CFR, pricing 30 days prior to delivery.
The steam cracker in Daesan has a production capacity of 1.1 million mt/year of ethylene, 550,000 mt/year of propylene and 150,000 mt/year of butadiene, while the Yeosu steam cracker is able to produce 1.18 million mt/year of ethylene, 550,000 mt/year of propylene and 130,000 mt/year of butadiene.
We remind that Lotte Chemical shut down its Deasan cracker for maintenance turnaround on October 14, 2019. The cracker resumed production on November 10, 2019.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
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.
MRC