Expansions: Lotte Chemical Titan starts up olefins complex in Indonesia; Braskem to expand PE/ethylene output in Brazil

Lotte Chemical Titan Holding Berhad (LCTH) has started up commercial operations at its ethylene plant in Indonesia, a major step in expanding its petrochemical footprint in Southeast Asia. The US$3.95 billion project is located in Merak, Cilegon, Banten Province, Indonesia.

Developed through subsidiary PT Lotte Chemical Indonesia, the complex boasts a capacity of 1 million tonnes/year of ethylene and 520,000 tonnes/year of propylene, positioning it as one of the region’s largest integrated petrochemical facilities. The project is a joint venture between Lotte Chemical Titan (51%), its parent Lotte Chemical Corporation (24%), and other Lotte Group affiliates.

LCTH emphasised that the plant strengthens the group’s ability to meet Southeast Asia’s rising demand for petrochemical feedstocks while improving production efficiency and cost competitiveness.

Lotte Chemical’s investment in this project marks the first operational facility in Indonesia. The self-sufficiency rate for basic fractions in Indonesia is less than 50%. Until now, Indonesian manufacturers have been importing naphtha from countries like Korea, Malaysia, and Singapore, making a local plant advantageous for supply chain and profitability.

Furthermore, with this commercial operation, Lotte Chemical has completed the vertical integration of its existing polyethylene (PE) plant in Indonesia. The production materials from the latest plant will also be linked with the engineering plastics (EP) plant located in Jawa Barat, Indonesia, achieving vertical integration.

In other news, Brazilian petchem firm Braskem announced that its Board of Directors has approved an estimated investment of R$4.2 billion to increase the capacity of its petrochemical complex in Rio de Janeiro by 220,000 tonnes/year of ethylene, along with equivalent volumes of polyethylene (PE)..

The initial phase of basic engineering, with a budget of R$233 million, had already been approved in February of this year.

The project marks another step in the company's strategy for industrial transformation and competitiveness and is part of its Transformation Program.

Scheduled for completion by the end of 2028, the project is subject to securing additional financing beyond the resources already approved under the REIQ Investments - Special Regime for the Chemical Industry - for the years 2025 and 2026. This strategy is part of ongoing analyses and discussions regarding the ideal capital structure for the company.

"Despite the current challenging global scenario, we must ensure that Braskem remains competitive in the new global petrochemical landscape, securing its survival and long-term sustainability. The investment in the Rio de Janeiro petrochemical complex demonstrates our confidence in Brazil's potential and Braskem's commitment to contributing to a sustainable reindustrialization of the sector, driven by innovation and value creation," says Stefan Lepecki, Vice President of South America Business at Braskem.

To enable the project, the Board also approved the procurement of additional volumes of ethane through a long-term supply agreement with Petrobras, which is currently in the final stages of negotiation. This measure ensures supply security and operational competitiveness, strengthening the strategic partnership between the two companies.

“The project aims to increase the use of gas in Braskem's feedstock matrix, reducing costs and emissions, and making the company's industrial park more modern, sustainable, and competitive,” added Stefan.

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