South Korea’s top chemicals maker LG Chem Ltd. plans to spend 124.6 billion won ($94.5 million) on increasing its water treatment material output capacity to double the business in the next five years.
LG Chem said on Monday it decided to invest the money to add a factory in South Korea with an annual capacity of 400,000 reverse osmosis (RO) membranes, which can desalinate 1.6 billion tons of water a year. That would be enough for 16 million people, about a third of South Korea’s population, according to the company.
RO membranes, which are used to remove salt and other pollutants from water, play a key role in wastewater treatment units.
LG Chem aims to double its RO membrane business, which is expected to generate sales of 200 billion won this year, in the next five years through the plant to be built in its production complex in
Cheongju, about 130 kilometers (81 miles) south of Seoul.
“We plan to significantly raise production capacity in Cheongju, the RO membrane production base, through additional investment, to actively target the industrial (water treatment) market following the seawater desalination sector,” said LG Chem Vice Chairman and CEO Shin Hak-Cheol in a statement.
“We are also set to develop the business into one -- meeting the global megatrend by expanding it to related sectors such as lithium extraction and CO2 separation in the future.”
SMART FACTORYLG Chem, the world’s No. 2 RO membrane producer, started the business in 2014 by acquiring NanoH2O, a US manufacturer of the seawater desalination material.
The world’s water treatment filter market is forecast to rise to 6.4 trillion won next year from 5.3 trillion won with an average growth of 3.9% a year, said LG Chem, citing industry tracker Global Water Intelligence.
LG Chem plans to build the new plant as a smart factory with artificial intelligence and an automated production process based on digital transformation. The AI is set to detect abnormalities in manufacturing lines and control quality, ramping up production speed by more than 25% compared to existing facilities.
The company will operate all the RO membrane factories, including the new one in Cheongju, soley with renewable energy by 2030.
Write to Jae-Fu Kim at
hu@hankyung.com Jongwoo Cheon edited this article.
