LG Chem to spend W 230 bil. on Naju plant
By Yoon Sung-won
LG Chem, Korea’s leading chemical company, said Thursday that it plans to spend 230 billion won ($201 million) by 2022 for the expansion and upgrade of a factory in Naju, South Jeolla Province.
The Seoul-based company said that it will expand the plant, which is located about 350 kilometers south of the country’s capital.
It also plans to build a 23,000 square-meter research center there with the aim of finishing it next year. The new facility will work on basic chemical substances and futuristic materials to nurture the company’s next-generation cash cows.
After the expansion, the plant’s annual capacity of eco-friendly plasticizer will more than double from 140,000 tons to 300,000 tons. The market for the product is 1.5 trillion won but the size is projected to expand at an annual growth rate of almost 10 percent for the next few years.
The revenue at the Naju plant is expected to rise to 1 trillion won by 2022 from the current 620 billion won.
“After the expansion and upgrades are completed, we will be able to reduce the manufacturing costs of eco-friendly products. That would substantially boost our bottom line,” an LG Chem official said.
The facility expansion is also a part of the company’s long-term initiative of increasing its revenues from eco-friendly products, which are currently around 3 trillion won.
The chemical powerhouse strives to jack up the figure to 7 trillion won by 2020 via proactive investments.
“Through the investments, we will complete the vertically integrated factory system, which involves development of new materials and manufacturing of final products,” the official said.
“The move would also create good jobs, thus galvanizing the economy in Naju and the surrounding areas,”
LG Chem acquired the Naju plant in 1984 and has operated it without any critical accidents for the past 33 years. In recognition of that, the government has picked it as one of safest workplaces in Korea since 2003.
“We have a state-of-the-art system designed to prevent accidents. We monitor the operation of the factory around the clock,” he said.
