SK Chemicals Co. plans to build plastic recycling plants in China in partnership with a Chinese eco-friendly materials supplier as its parent SK Group builds its presence in the waste treatment and recycling market across Asia.
On Monday, the South Korean company signed a memorandum of understanding with China’s Sheye to set up a joint venture and build factories in Shantou, China, SK said.
The MOU followed SK Chemicals’ 23 billion won ($18 million) investment to buy a 10% stake in Sheye last year. The stake purchase granted SK the right to buy 20,000 tons of chemically recyclable plastic materials.
SK Chemicals will take management rights in the venture with a stake of more than 51%. The JV plans to replace the raw materials of PET and copolyester with recycled plastics.
One of the plants to be built will depolymerize plastic waste to extract 100,000 tons of recyclable materials per year.
Using those materials, the other facility will produce 200,000 tons of polyethylene terephthalate (PET) and copolyester per year using chemical recycling technologies.
PET is widely used in the packaging of foods and beverages. Copolyester is a highly transparent plastic material used mainly for cosmetics containers.
Chemical recycling technologies refer to thermal dissolution and depolymerization. In contrast, mechanical recycling methods are not adept at recycling contaminated plastics.
SK Chemicals and Sheye will reach a firm agreement on the JV within the year and begin plant construction by early next year. Sheye will provide land for the facilities.
Commercial operation is expected to begin in late 2024.
On its home turf, SK is considering building a similar facility that extracts 50,000 tons of recyclable plastic materials per year as early as 2025.
In 2021, SK Chemicals became the world’s first company to kick off commercial production of copolyester raw materials from chemically recycled plastic waste.
This year, it opened a mass production facility for PET, using chemical recycling technologies.
SK Chemicals plans to replace half of its copolyesters' raw materials with recycled plastic by 2025 and 100% by 2030.
Write to Kyung-Min Kang at kkm1026@hankyung.com
Yeonhee Kim edited this article
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