A view of LG Chem’s plant at the Yeosu Industrial Complex. (Photos: LG Chem)

LG Chem Vice Chairman Park Jin-soo.

LG Chem plans to plunk down more than 2 trillion won in petrochemical projects, including one to build a new naphtha cracking center in Yeosu, South Jeolla Province.
LG Chem Vice Chairman Park Jin-soo will next week convene a board of directors’ meeting and finalize facility investment plans, including one to build a new NCC facility within the Yeosu National Industrial Complex, business sources said.
LG Chem posted 2.93 trillion won in operating profit last year, its largest-ever profit. The company saw cash assets soar thanks to its booming business situation.
The planned NCC plant will produce polypropylene, polyethylene and other general use products as well as value-added items. It will be built on idle land within the Yeosu National Complex, which is owned by LG Chem. The construction of the new plant will shore up the position of the company, which ranks 1st with an annual capacity of 2.2 million tons in terms of production of ethylene.
LG Chem’s investment plan is in keeping with its strategy to focus on profit-taking business areas. LG Chem has been put on hold for more than six years a plan to invest into the information electronics materials, including LCD glass plates, which have been sluggish.
Entering this year, views on a plan to invest into the LCD glass plate sector are getting more pessimistic. It was in 2012 that LG Chem first put on the public notice the 700 billion won investment plan on the LCD glass plate sector, but it has been delayed. Last December, LG Chem put on a public notice a decision to put on hold the investment plan.
LG Chem seems to attach investment priority to securing a competitive edge in core business sectors. The company continues to invest in the EV battery business LG Chem is nurturing as a new business, but the company is threatened by Chinese late-comers, including CATL, which recently came up with a massive investment plan.The bio business, acquired by LG Chem, is struggling with rising R&D costs, requiring long-term investment rather than rapid growth.
A nod on the new investment plant will be determined by new LG Group Chairman Koo Kwang-mo, who took office recently.
The investment plan is in line with the President Moon Jae-in government’s demand for expanding investments and creating jobs in Korea. Early this year, LG Group revealed a plan to plunk down 19 trillion won in Korea and create 10,000 jobs. LG Chem announced a plan to raise capital investments to 3.8 trillion won, a 52 percent surge from 2.5 trillion won in 2017.
Minister Paik Un-gyu of the Ministry of Trade, Industry and Energy had a breakfast meeting with CEOs of the nation’s top ten conglomerates to discuss ways of providing the government’s strategic support to corporate investment expansion and job creation. An LG Chem official would not disclose details of the investment plan, which is to be determined by the board of directors.
Lakhwi Chemical, established in 1947, is predecessor of LG Chem and founding company of LG Group.