South Korean chemical giant Lotte Chemical announced on January 7 that it had signed a Memorandum of Understanding (MoU) with the Indonesian government to build a large-scale petrochemical complex worth around $3.9 billion (£2.9b).
The announcement was made during an online video conference involving representatives from Lotte Chemical, its subsidiary Lotte Chemical Titan, and the Indonesian government. The LINE project, which will be located in the Banten region of Indonesia, will be constructed with the help of Lotte Chemical Titan – formerly Titan Chemicals before it was bought by Lotte in 2010. The subsidiary, one of the largest producers of polyolefin in Southeast Asia, has a production site in Malaysia consisting of twelve plants, two co-generation plants and three tank farms.
Lotte Chemical is planning to begin commercial production at the new Indonesian complex in 2025 and aims to generate over $2 billion of annual revenue, the company said. Once complete, Lotte said the petrochemical complex will annually produce 1 million tonnes of ethylene, 520,000 tonnes of propylene, 250,000 tons of polypropylene, as well as downstream products.
The Indonesian government said it will provide incentives such as support for lowering import tariffs on raw materials, exemption from tariffs on imports of various facilities and equipment used in factory construction, and strengthening tax benefits for Lotte Chemical’s successful project implementation and commercial production.
Lotte Chemical’s vice chairman Kim Gyo-hyun said: “The LINE project is an important project that can not only strengthen Lotte Chemical’s global business competitiveness, but also derive mutual strategic value, such as economic growth and job creation in Indonesia. We express our gratitude to both the central and local governments, and we hope that this large-scale investment by Lotte Chemical will be successful and contribute to the overall Indonesian economy based on their continued support.”
For more information visit www.lottechem.com
