SK Global Chemical has rebranded itself to SK Geo Centric effective August 2021 to highlight its strategic shift towards supporting a green economy as a plastics upcycling company, although it will be able to retain its acronym SKGC. The newly-named entity plans to invest $4.3 billion in what it terms “green sourcing” by 2025.
Under its initial action plan, the company will roll out more eco-friendly materials and increase its plastic waste-plastic processing capacity (read advanced or chemical recycling) to a level equivalent to the production of 900,000 tonnes/year of plastic over the next four years. The company will also increase its direct or indirect recycling of plastics to over 2.5 million tonnes/yr by 2027 through strengthening collaboration with overseas partners for chemical recycling technologies such as depolymerization and pyrolysis.
An initial $525 investment in South Korea’s largest plastics-to-crude oil recycling facility in Ulsan, Korea which will process 184,000 tonnes/yr. Construction is scheduled for completion in 2025.
Some observers note the high investment cost for this plant based on typical investment costs for naphtha crackers. It does seem that such chemical or advanced recycling facilities will only be financially viable if legislation is mandated. In this respect, the recent announcement by PlasticsEurope, the association of European plastics producers, that they support the European Commission’s proposal for a mandatory EU recycled content target for plastics packaging and are calling for a target of 30% for plastics packaging by 2030 is telling.
Ramping up chemical recycling is viewed as essential to achieve such a mandatory target and PlasticsEurope members are planned investments in this technology and infrastructure of €2.6 billion (US$3 billion) by 2025 and €7.2 billion ($8.5 billion) by 2030 in Europe. If the rest of the world follows Europe’s lead, SK Geocentric’s initiative may prove a smart move. Further, despite higher production costs and the need to collect plastics, lifecycle analysis (LCA) by BASF has shown chemical recycling to reduce CO2 emissions compared with fossil fuel-based plastics.