Kim Jeong-Kwan: "Petrochemical Restructuring Plans Submitted... No Room for Complacency"

The Petrochemical Industry's Restructuring Begins
12 Companies Participate, Detailing Voluntary Reductions
"The Most Dangerous Moment Is When Results Appear... Now Is the Time for Action"

The government-led restructuring of the petrochemical industry has passed its first major hurdle. The Ministry of Trade, Industry and Energy announced that all requested business restructuring plans had been submitted by the end of this year, signaling that the discussion on restructuring has moved from a declarative stage to one of execution. However, the government cautioned that this is now the stage where implementation must begin, warning against moving too quickly.

At the Petrochemical Industry Business Restructuring CEO Meeting held on December 22, Kim Jeong-Kag, Minister of Trade, Industry and Energy, stated, "If this year was about setting the strategy, next year will be the year of execution, which will determine the success or failure of the restructuring." He added, "The moment when results begin to appear is actually the most dangerous time." He further emphasized, "If we think 'this is enough,' the restructuring will lose momentum and we will miss the golden opportunity."

Kim Jeong-Kag, Minister of Trade, Industry and Energy (center front), and attendees are posing for a commemorative photo at the 'Petrochemical Industry Business Restructuring CEO Meeting' held on December 22, 2025, at the Chamber Lounge of the Korean Chamber of Commerce and Industry in Jung-gu, Seoul, to successfully implement the restructuring of the petrochemical industry. Photo by Jo Yongjun

Previously, at the 'Petrochemical Industry Rebound Voluntary Agreement Ceremony' in August, the Ministry of Trade, Industry and Energy requested the submission of business restructuring plans by the end of the year. Following this, companies entered into voluntary agreements and, after discussions, all restructuring plans were submitted on December 19. The participating companies are LG Chem, Lotte Chemical, Hanwha Solutions, HD Hyundai Chemical, Korea Petrochemical Ind. Co., GS Caltex, S-Oil, SK Geocentric, Hanwha TotalEnergies, DL Chemical, Hyosung Chemical, and SK Advanced-a total of 12 companies. Hanwha Solutions and DL Chemical are major shareholders of Yeochun NCC, which operates three NCC units in Yeosu. Hyosung Chemical and SK Advanced own propane dehydrogenation (PDH) facilities dedicated to propylene production.

The Ministry of Trade, Industry and Energy believes that if the current plan is implemented without setbacks, the industry will be able to achieve its voluntary target of reducing ethylene production capacity by 2.7 million to 3.7 million tons. Minister Kim assessed this as "successfully taking the first step in the restructuring discussion," but stressed that from now on, the key will be whether the plans are actually carried out. He said, "The reason we are gathered here today is not to settle for small achievements," and added, "The government and companies will do their utmost to see the restructuring through to completion."

Kim Jeong-Kag, Minister of Trade, Industry and Energy, is speaking at the 'Petrochemical Industry Business Restructuring CEO Meeting' held on December 22, 2025, at the Chamber Lounge of the Korean Chamber of Commerce and Industry in Jung-gu, Seoul. Photo by Jo Yongjun

In addition, the Ministry of Trade, Industry and Energy announced that as soon as the final restructuring plans are submitted, it will thoroughly review them and provide a support package that includes financial, tax, research and development (R&D), and regulatory relief measures to ensure implementation. Minister Kim stated, "The government, as a pacemaker, will spare no effort to support the private sector so that their decisions lead to tangible results."

The restructuring will also be accompanied by a transition to a high value-added industrial structure. On December 23, the Ministry plans to launch the 'Chemical Industry Innovation Alliance.' This is part of the 'R&D Support Package' announced earlier this month. The government intends to actively support research and development and infrastructure building that connects core industries with advanced materials and eco-friendly sectors. In this process, priority will be given to supporting the technology development of companies participating in the restructuring.

Minister Kim emphasized, "Just as Admiral Yi Sun-sin achieved victory with 12 ships, the 12 companies gathered here today, together with the government, must complete the marathon of restructuring as a unified team." He concluded, "Let us resolve to see these changes through to the end, remembering that it is not over until it is truly over."