SK Global Chemical rebrands as plastic recycling firm SK Geo Centric

SK Global Chemical on Tuesday rebranded as SK Geo Centric to transform into an urban plastic recycling company with plans to invest 5 trillion won ($4.3 billion) by 2025.

During a press conference Tuesday, CEO Na Kyung-soo presented a new direction for the firm, which has engaged in the petrochemicals business since opening the country’s first naphtha-cracking plant in 1972.

Utilizing three key technologies -- solvent extraction, depolymerization and pyrolysis -- the company will turn polluted, mixed waste plastic into clean, recycled raw materials, Na explained.

“SK Geo Centric will first secure a domestic recycling capacity of 900,000 metric tons by 2025, which is equivalent to the firm’s current annual production capacity of plastic in South Korea,” Na said.

The firm will then expand the capacity to recycle 2.5 million tons of plastic trash every year by 2027, which matches the firm’s global production capacity of plastic. The amount is equal to 20 percent of the waste plastic that flows to the ocean every year, the executive added.

Stressing that it is not a side project to boast the firm’s profile on the environmental, social and governance front, Na pledged a full-fledged commitment to achieving profitability through economies of scale.

SK Geo Centric estimates that the global recycled plastics market will see an annual growth of 12 percent by 2030 and reach a size of 600 trillion won by 2050. The global trend of carbon neutrality will spur demand for SK Geo Centric’s recycled plastic, which emits roughly 50 percent less carbon compared to newly produced plastic, the company explained.

“SK Geo Centric will achieve an EBITDA of 600 billion won in green and recycling business, a higher figure than that of its current business, and transform 100 percent into a financially green company,” the CEO said, referring to its earnings before interest, taxes, depreciation and amortization.

SK Geo Centric will establish waste plastic recycling facilities at home and abroad in collaboration with partners including PureCycle, Loop Industries and Brightmark. It is considering joint ventures or equity investments as a means for business partnerships, it said.

A wholly owned subsidiary of SK Innovation, the company derives much of its revenue from packaging materials for milk, meat and similar foodstuff, as well as interior and exterior materials for automobiles. It’s first naphtha cracker in Ulsan shut down permanently last year.

By Kim Byung-wook (kbw@heraldcorp.com)