08 December 1997 00:00 [Source: ACN]
LG CHEMICAL said it will postpone construction of its 300 000 tonne/year vinyl chloride monomer (VCM) expansion project in Yeochon, South Korea.
Construction will start in 1999 or 2000, instead of early 1998.
The company has to restudy the project's viability because of falling prices of petrochemical products, an LG official said.
'We also need to take into account high interest rates and factors affecting production such as material costs. But one thing for sure, LG will not cancel the project,' he said.
LG will also increase its ethylene dichloride (EDC) production to support the increase in VCM capacity. VCM capacity in Yeochon is now 600 000 tonne/year.
The company is also looking at the Middle East and Western Australia for an overseas EDC investment, with a capacity of about 400 000 tonne/year.
'We need good infrastructure and cheap production costs,' the official said. South Korean capacity is now slightly over 200 000 tonne/year.
LG has submitted its proposal to build a 450 000 tonne/year chloralkali and 300 000 tonne/year EDC project in Pilbara, and is awaiting the response from the Western Australian government (ACN 13 Oct, p27).
Other South Koreans eyeing the site include Hanwha, Daewoo and Hyosung T&C. Competition will be tough as 33 proposals have been submitted for the Pilbara project and only one proponent will be selected. A decision is expected early next year.
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