SEOUL, Sept. 18 (Korea Bizwire) – The SK Geocentric Ulsan ARC (Advanced Recycling Cluster), which is expected to be built near the Ulsan Complex (CLX) petrochemical complex, is gaining attention as Ulsan’s ‘urban oil field.’
The Ulsan ARC is the world’s first plastic waste recycling complex, conceived by SK Innovation subsidiary SK Geocentric with an investment of about 1.8 trillion won.
With a size equivalent to that of 22 soccer fields, the Ulsan ARC has an annual plastic waste processing capacity of 320,000 tons, a volume equivalent to about 21.3 billion units of 500ml water bottles. SK Geocentric plans to recycle the plastic waste processed at the facility into raw materials such as pyrolysis oil used to produce petrochemical products.
In general, the recycling of plastic waste can be divided into mechanical (physical) and chemical recycling. Unlike mechanical recycling, which involves the simple crushing and washing of plastic waste, chemical recycling recovers raw materials such as naphtha and pyrolysis oil by breaking down plastics, thus having the advantage of maintaining the quality of the materials. Since there is no limit to the frequency of recycling, the related facilities have been called an ‘urban oil field.’ The ground-breaking ceremony for the Ulsan ARC is scheduled for late October or early November, and commercial operations are expected to commence in late 2025.
Among the three primary technologies, SK Geocentric is placing a focus on pyrolysis. The company aims to improve both the quality and usability of the pyrolysis oil obtained through post-treatment processing technology developed in-house. The pyrolysis oil, from which byproducts are removed through post-treatment processing, can serve as a raw material for petrochemical products. Conventional pyrolysis oil, containing a high level of byproducts, is primarily used as low-quality diesel and boiler oil, making it less suitable for petrochemical processing.
The chemical recycling of plastic waste offers a more sustainable carbon reduction effect compared to simple incineration. According to the renowned multinational chemical company BASF, pyrolysis-based plastic waste recycling can reduce carbon emissions by up to 61.5 percent more than simple incineration. A study has shown that reusing 1 ton of plastic waste to produce pyrolysis oil can reduce carbon emissions by up to 2.7 tons more than incineration.
SK Geocentric has already secured about 90 percent of the 320,000-ton annual processing capacity for plastic waste. The company has not disclosed specific supply sources due to the hike in demand for plastic waste. Even before launching full-scale operations, the company received significant interest from global customers in plastic waste recycling materials, including pyrolysis oil. Contracts for about 15 to 20 percent of the annual processing volume have been finalized, and talks for additional contracts are underway.
The market outlook is bright as regulations on plastic waste recycling are being adopted globally. The EU has legislated that recycled materials must constitute more than 30 percent of plastic packaging. In the U.S., there is a growing trend, particularly in states like California, to increase the mandate for the use of recycled materials to over 50 percent by 2030. The global consulting firm McKinsey predicted that the market size for plastic waste recycling would reach 600 trillion won by 2050.
J. S. Shin (email@example.com)