Blast at S.Korea's Lotte Chemical shuts naphtha cracker; injures 31 people
SEOUL (Reuters) - South Korea's Lotte Chemical has shut its naphtha cracker after an explosion at the plant in the southwestern city of Seosan, which injured 31 people.
The explosion, which was triggered by a fire at a compressor in Lotte Chemical's naphtha cracker at around 3 a.m. (1800 GMT), has been contained and was under control, the company said in a statement.
The petrochemical maker said it had suspended its naphtha cracker's operations in Daesan town, in Seosan, due to the fire and would seek to minimise supply disruptions.
The company was looking into the exact cause of the accident, it said, adding there was no leak of toxic chemicals.
Lotte Chemical runs two naphtha crackers in South Korea. One is in Daesan, which can produce 1.1 million tonnes per year of ethylene, with the other 1.2 million tonne per year cracker in the southwestern city of Yeosu.
"As the company's gas compressor exploded, it will take at least six months to restore considering the time to order a new one and install it," said Roh Woo-ho, an analyst at Meritz Securities.
Lotte Chemical's most recent spot naphtha deal was done on Feb. 26 where it had secured cargoes for first-half delivery to its Yeosu and Daesan crackers.
Trading sources who track naphtha said the petrochemical maker typically imports between 75,000 and 125,000 tonnes of naphtha a month for its Daesan cracker.
Shares of Lotte Chemical closed down 2.4% following reports of the accident, while the broader market closed up 2.2%.
(Reporting By Jane Chung; additional reporting by Seng Li Peng in Singapore Editing by Chris Reese & Shri Navaratnam)
Comments