SK Energy cuts Korea cracker rate on high naphtha

05 March 2008 09:08  [Source: ICIS news]

SINGAPORE (ICIS news)--South Korea's SK Energy has cut the operating rate at its smallest No 1 naphtha cracker in Ulsan by 20% due to high naphtha costs, a source close to the company said on Wednesday.

The 190,000 tonne/year ethylene plant will run at 80% for March, he said, adding that the reduced rates could continue in April if market conditions remained unfavourable.

The ethylene production loss for the month-long period is estimated at 3,100 tonnes, roughly equivalent to a mid-sized spot cargo.

Naphtha prices have hovered above $900/tonne CFR (cost and freight) Japan while spot ethylene prices have fallen continuously for the past three weeks to $1,250/tonne CFR northeast Asia.

SK Energy’s larger No 2 cracker in Ulsan produces 650,000 tonnes/year of ethylene and is still running at full rate.

By: Steve Tan
+65 6780 4359

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