South Korea Orders Production Halt at Petchem Plant after Blast Kills Four

Reuters, February 14, 2022

South Korean authorities have ordered a production halt at one of petrochemical company Yeochun NCC's (YNCC) three naphtha crackers after a blast killed four people and injured four.

The incident at YNCC's third plant in the city of Yeosu comes as South Korean businesses brace for greater scrutiny under a new law that punishes management for incidents involving worker death.

YNCC said it had previously been mistaken in describing the order from authorities as not a production halt but one limited to having workers removed from the plant. A labor ministry official confirmed that the order was for a production halt.

"To turn the plant off, the procedure is quite complicated. It usually takes about a year to plan a single shutdown and restart. This time, it could take at least 10 days to turn off the third plant," a YNCC official said.

"Currently, we intend to suspend operations according to administrative measures."

YNCC's other two plants - also located in Yeosu - are operating, the company official said, adding that the blast occurred during a leak test in a cleaning process that is a procedural operation carried out every four years.

YNCC's third naphtha cracker produces 470,000 tonnes per year (tpy) of ethylene. YNCC's first and second naphtha crackers produce 900,000 and about 920,000 tpy of ethylene each.

YNCC's entire capacity is about 1.1% of global capacity, Samsung Securities analyst Cho Hyun-ryul said.

The new South Korean law, which took effect late last month, can mean business owners or relevant managers face one or more years of jail or fines of up to 1 billion won ($834,000) for severe industrial accidents if they are found to to have violated their duty of safety.

(Reporting by Heekyong Yang and Joyce Lee; Editing by Gerry Doyle, Raju Gopalakrishnan and Edwina Gibbs)

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