Yeochun Shuts Ethylene Plant; Keeps 70% Overall Operating Rate

By Shinhye Kang

Nov. 19 (Bloomberg) -- Yeochun NCC Co., South Korea's largest ethylene producer, will shut the smallest of its three plants to cut costs, a company official said. It will ramp up output at its biggest facility to maintain run rates at 70 percent of overall capacity.

Yeochun will today start unscheduled maintenance at the plant, capable of making 400,000 metric tons of ethylene from naphtha each year, said the official, who declined to be identified because of company policy.

Operations at Yeochun's largest, 857,000 tons-a-year facility will be increased to the maximum level from the current 70 percent. Production at its third, 555,000 ton-a-year plant will remain at 70 percent.

The company lowered operating rates at all three plants to 70 percent on Oct. 20 from 80 percent as the global financial crisis reduced demand. It's more efficient for Yeochun to shut the smallest plant, known as a cracker, and run its largest one at 100 percent capacity, the official said.

Yeochun NCC is equally owned by Daelim Industrial Co. and Hanwha Chemical Corp. Ethylene, mainly made from naphtha, is used to produce plastics and chemical products.

To contact the reporter on this story: Shinhye Kang in Seoul at skang24@bloomberg.net.