SK Chemicals makes $98-million investment in recycled PET market

In a deal that could have ramifications in the North American market, South Korea’s SK Chemicals has signed a US$98.4 million agreement to acquire a chemical recycling plant and PET production facility from China-based Shuye Environmental Technology.

The acquired recycling plant uses depolymerization technology to chemically break down plastic waste into monomers and produce recycled bis-hydroxyethyl terephthalate (BHET), which is an intermediate in the production of PET.

Under the present agreement, these assets have now been transferred to SK Chemicals. As a result, SK Chemicals says it now owns the world’s first commercially available polyester chemically recycled raw materials and production facility, which can be sold separately. In a statement, SK Chemicals officials said the deal allows them to pull well ahead of the other domestic companies in this space.

SK Chemicals also said that, once it had validated its production technology, it planned to build infrastructure in China and other countries – in Europe, North America, and beyond – to meet the rapidly increasing demand for recycled plastic waste around the world.

“We will strive to become a leading company in the global recycled plastic market by pursuing global expansion and advanced recycling business models,” Ahn Jae-hyun, CEO of SK Chemicals, said in the statement.

The company also plans to sell the chemically recycled BHET as a standalone product to polyester manufacturers who want to produce recycled products.

In its statement, SK Chemicals cited a report from analyst Wood Mackenzie indicating that the global market for recycled PET in 2022 was about 9.7 million tons and that most of the material was mechanically recycled.