Advanced subsidiary inks pact for $420 mln PP plant in South Korea

Advanced Petrochemical Company (Advanced) subsidiary SK Advanced Company Ltd and PolyMirae Company Ltd have signed a joint venture agreement to set up a polypropylene (PP) plant in South Korea, it said in a statement to Tadawul on Sunday.

The estimated $420 million plant will have a capacity to produce 400,000 metric tons per annum and will  be financed with 60 percent debt and 40 percent equity, respectively.

The new venture is expected to begin construction in January next year with commercial operations likely to start from 2021. SK Advanced will supply propylene (main feedstock) to it on a long-term basis.

The financial impact of investment on Advanced is expected only after the venture begins commercial operation, the statement added.

SK Advanced is a joint venture company in South Korea, which is owned 30 percent by Advanced through Advanced Global Investment Company, and SK Gas and Petrochemical Industries Company.  Currently, it is operating a plant in South Korea since 2016 that has capacity to produce 600,000 metric tons per annum of propylene.

PolyMirae Company Ltd is a 50:50 joint venture between LyondellBasell and Daelim.