South Korea's Lotte Chemical and HD Hyundai to merge naphtha operations under petrochem plan, report says

LOTTE CHEMICAL

25/11/2025 12:33

SEOUL, Nov 25 (Reuters) - South Korea's Lotte Chemical 011170.KS plans to shut its naphtha cracking operation to merge with HD Hyundai 267250.KS as part of the country's push to restructure an oversupplied petrochemical sector, a news report said on Tuesday.

Lotte will merge its 1.1 million metric-ton naphtha cracking facilities and jointly operate HD Hyundai's plant with an output of 850,000 metric tons under a plan to set up a joint venture, the Korea Economic Daily newspaper reported.

South Korea's 10 petrochemical companies have agreed to restructure their operations to resolve what the government has said was a "crisis" situation resulting from overcapacity in return for financial support.

Lotte Chemical and HD Hyundai could not be reached for comment after business hours on Tuesday.

The government has a plan to cut naphtha-cracking capacity by up to 3.7 million metric tons per year to resolve oversupply and improve profit margins by merging production or shutting smaller companies and has required companies to submit plans by year-end.

 (Reporting by Jack Kim
Editing by Ed Davies)

 ((jack.kim@thomsonreuters.com; +822 6936 1455;))