SINGAPORE (ICIS)--South Korean SK Global Chemical (SKGC) has signed a deal with Chinese producer Zhejiang Satellite to build a 40,000 tonne/year ethylene (C2) acrylic acid (EAA) plant at Lianyungang in eastern China.
Under a memorandum of understanding agreement (MoU) signed on 11 March, the two firms will establish a new joint venture company for the won (W) 200bn ($176m) project for the production and sales of EAA, the South Korean producer said on 14 March.
"SK Global Chemical plans to make its first EAA plant in China a bridgehead to preoccupying the eco-friendly, high value-added packaging markets in Asia, and develop it into a hub for eco-friendly chemical materials," the company said.
EAA is widely used as an adhesive for packaging materials such as aluminum foil.
The South Korean producer has two existing EAA plants in the west - one in Texas in the US, and the other in Tarragona, Spain.
Global demand for EAA is expected to increase by about 10,000 tonnes each year, driven by multi-layer packaging and aseptic packaging, which take about 75% of the entire EAA market, according to SKGC.
China's Zhejiang Satellite produces and sells various acrylic acid applied products such as super absorbent polymer (SAP), and polypropylene (PP).
The Chinese producer is expected to start-up its ethane cracker in Lianyungang in March-April this year.
The 1.25m tonne/year cracker is the first in northeast Asia that will use ethane as sole feedstock for production.
($1 = W1,137)
Photo: Busy Lianyungang Port in Jiangsu province in eastern China, 08 Mar 2021 (Source: Shutterstock)