LONDON (ICIS)--Lotte Chemical UK (LCUK) is still on course to start up its 200,000 tonne/year polyethylene terephthalate (PET) plant in Teeside, UK, in the first quarter of 2014, despite its proposal to close the upstream purified terephthalic acid (PTA) plant in Wilton, UK, a company source said on Wednesday.
Pending the consultation process with employees affected by the decision to shut the PTA plant, LCUK could bring feedstock into Europe from Asia, "instead of making it in situ and transferring it by pipe," the source said.
Closure of the PTA plant will lead to a loss of around 70 jobs
LCUK operates a 165,000 tonne/year PET plant and is in the final stages of construction of a 200,000 tonne/year PET plant in Teeside, UK. The new plant, known as LC1, is due to start up in the first quarter of 2014.
"Manufacture of PET resin from the existing downstream plant and the construction of the new LC1 plant will not be impacted by this decision," as highlighted in an email to external parties on 3 December.
The 40 year old PTA plant was part of the asset base acquired in January 2010 by Lotte Chemical Corporation of Korea from Artenius UK Ltd, currently in administration.
"Rapid changes in market conditions in late 2012, maintained through 2013 have resulted in the market price of PTA being too low to allow LCUK to compete with more modern, world scale PTA assets operating at much lower manufacturing costs and in particular energy costs. The global supply-demand balance is unlikely to improve in the foreseeable future as huge additional PTA capacity has already, and will continue to, come online in China," the email states.
LCUK is the latest victim in the struggling European market.
Indorama Ventures recently announced its intention to mothball a 155,000 tonne/year PET plant in Workington, UK. Indorama will continue to supply the UK from its other European plants.LSB is also a major shareholder in Artlant PTA in Sines, Portugal.
($1 = €0.74)
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