SK Geo Centric discusses its plans for a circular economy in Asia (2022)

SK Geo Centric, a subsidiary of SK Innovation, has been developing petrochemicals in South Korea for 60 years. The company says its goal is to transform into the world's leading plastic recycler by leveraging what it calls “vast opportunities” for the development of "urban oil fields.”

To achieve this, the company has launched its Waste & Carbon Zero strategy. Through 2021 and into 2022, SK Geo Centric has invested $260 million to further mechanical and advanced recycling of plastics and the necessary infrastructure. In the North American markets, SK Geo Centric has invested $56.5 million in Quebec-based Loop Industries, $55 million in PureCycle Technologies of Orlando, Florida, and $10 million with Closed Loop Partners, New York City, to advance circular business models, scalable recycling technologies and material recovery infrastructure in the U.S.

Recycling Today recently spoke with SK Geo Centric CEO Na Kyung-Soo to discuss the company's Waste & Carbon Zero strategy, its investments and the plastic industry. The following interview has been edited for clarity.

SK Geo Centric discusses its plans for a circular economy in Asia (1)

Photo courtesy SK Geon Centric

Recycling Today (RT): SK Geo Centric has launched its Waste & Carbon Zero strategy. Can you explain in detail what this strategy encompasses and what your specific goals around plastics are?

Na Kyung-Soo (NKS): The SK Geo Centric Plastic & Waste Zero strategy is to recycle 2.5 million tons of produced plastic, accounting for 100 percent of the [company’s] global production volume, and expand the proportion of eco-friendly products, such as ethylene and acrylic acid (EAA) copolymers, to 100 percent by 2027.

To meet this goal, we are running a 3R strategy to reduce plastic usage and replace it with eco-friendly or recyclable products. Ultimately, SK Geo Centric is committed to reducing its carbon emissions by half compared with 2019 levels and achieving a net zero target by 2050.

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RT: What do you believe the biggest hurdles in plastics recycling are? How can they be overcome?

NKS: Recycling plastic is inherently difficult and faces numerous challenges. Firstly, we need to create a social atmosphere of recycling plastic and build a social system to encourage it. We should also drive the shifts in people’s perception of the reckless use of plastic.

Another challenge comes in the form of collecting plastics. The amount of plastic that is recyclable is quite limited based on the variation in the types of plastic. Each plastic has its own set of challenges when it comes to recyclability. Incorrectly discarded plastic mixing with recyclable plastic can disrupt the recycling process. In some cases, items discarded with plastic recyclables are not plastic. Once contaminated by outside elements, including food, plastic is much more difficult to recycle.

Korea is good at separating plastics from the waste stream, but the Asian region is still lagging. Investments in facilities to collect and sort plastics are needed. It is also essential that the government and citizens should be engaged in efforts to do that.

By adopting great technology, we should increase the rate at which discarded plastic is collected and sorted. Establishing a circular economy to efficiently collect and recycle plastic requires the construction of more recycling facilities.

Developing a plastic circular economy is not something SK Geo Centric can do alone. As a company, we have acquired a 10 percent equity stake in Loop Industries. Additionally, we recently joined as an equal partner [in] a joint venture with Loop Industries and Suez to build an “infinite loop” facility.

[The] SK Geo Centric Research and Development Center is also working to improve postprocessing pyrolysis technology to remove impurities like chlorine and sulfur.

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RT: Many chemical companies that have embraced chemical recycling have been accused of greenwashing. How do you respond to those accusations?

NKS: SK Geo Centric’s commitment to developing a more sustainable business model speaks for itself. We are building the world's first large-scale plastics recycling cluster in Ulsan, South Korea. As a company, we are taking concrete steps to reduce carbon emissions. As part of this effort, SK Geo Centric’s pyrolysis oil carbon reduction process was certified by the country’s Ministry of Environment for its carbon reduction effect. When processing 1 ton of plastic, the technology could capture as much as 2.7 tons of carbon without incineration.

There is a perception that the chemical recycling process requires a lot of utility and energy, and residues from the process are not good for the environment. The process often refers to pyrolysis, which can be a competitive solution compared to landfilling. The latest research in pyrolysis includes technology that allows for minimizing the use of energy and recycling of residues.

RT: Recently, your company acquired three different methods of plastics recycling, pyrolysis, depolymerization and solvent extraction technology for polypropylene. How does SK Geo plan to use this technology to meet its recycling goals?

NKS: As well as our research scaling pyrolysis technology, we are also working with our partner Loop Industries to scale depolymerization, a process that breaks down large molecular blocks, such as polyethylene terephthalate (PET), into reusable basic materials. Additionally, SK Geo Centric and PureCycle announced the location of Asia’s first polypropylene (PP) recycling plant. We are also negotiating a joint venture agreement with PureCycle Technologies and [its] solvent extraction technology to recycle large amounts of PP.

RT: What role does mechanical recycling play in your strategy?

NKS: What matters is how smart we can be when it comes to the use of plastics. If we care about the environment, we need to reduce the use of single-use plastics and shift toward multiuse plastics. If that is not possible, the obvious alternative is recycling. It’s important to use plastics in the longest possible and smartest way. Among the recycling methods, mechanical recycling is the cheapest. However, mechanical recycling has limitations because materials can only be recycled a limited number of times until degradation happens, causing a reduction in quality.

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As a method to remove the limitations, we are considering advanced recycling. SK Geo Centric believes that the advanced recycling process we are developing could help solve the plastic waste problem. As part of this global approach, we anticipate forging deeper collaborations with North American companies.

RT: How do the company’s North American partnerships with Loop Industries and PureCycle factor into its recycling goals?

NKS: With Loop Industries and PureCycle, we are building facilities and ramping up plastic reduction efforts across Asia and globally. We are also working to recycle the synthetic fibers from clothes containing large amounts of polyester. Boosting the technology’s applications will increase recycling rates and help achieve our stated goals.

With PureCycle’s technology, we anticipate producing 60,000 tons of recycled plastic annually from raw PP material as part of our urban oil field strategy. If successful, we could replicate the model driving the development of our Ulsan recycling cluster to other markets, including China.

SK Geo Centric is partnering with Loop and Suez to build an infinite loop manufacturing facility in Europe. The partnership will combine SK’s petrochemical manufacturing, Suez’s resource management expertise and Loop’s breakthrough proprietary technology.

RT: Your company is also expanding into Asia. Where will the facilities be located, what will they specialize in and when will they be operational?

NKS: By 2025, a large-scale recycle cluster will be built in Ulsan, near our existing refining and chemical plants. At full capacity, the Ulsan cluster could recycle about 200,000 tons of plastic, which will help capture 500,000 tons of carbon emissions annually.

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The advantage of the Ulsan recycling cluster is the synergies it unlocks. For example, various byproducts extracted from the recycling process, including PP and PET, can be used as feedstock to support other recycling processes. Some of the waste can also be used to support pyrolysis. Even the final discharges captured by the recycling process can be utilized by the refinery located next to the cluster. Having a recycling cluster completed in Ulsan, we are also considering expanding it into China and Southeast Asia.

RT: Where will you source the material for these facilities? What types of materials will you be targeting?

NKS: We are working with several companies in South Korea and Asia to secure PP materials and PET, including hard-to-recycle colored PET bottles, as part of our ongoing effort to grow our recycling feedstock. Korea generates about 8 million tons of plastic waste annually. Despite that volume, there is still a shortage of recyclable-ready plastic waste. Only when we can secure a stable source of raw material will we be able to establish a profitable circular economy underpinned by advanced recycling operating at scale.

Our target feedstock is mostly from municipal recycling facilities. We are also considering using waste generated from industrial manufacturing processes as feedstock. [The] most commonly used plastics, PET and PP, will be our priority. Our priority is to recycle flexible films by pyrolysis. To that end, advanced recycling will be used to recycle colored PET bottles or polyester fiber that cannot be processed by mechanical recycling.

RT: Why is it important to invest in recycling plastic and the circular economy of plastics?

NKS: A plastic circular economy is fundamental to solving the plastic waste problem. It is difficult for us to create a plastic circulatory system alone. We found the Closed Loop Partners (CLP) Fund shares the same values with us. The CLP Fund, which brings together companies invested in eco-friendly businesses, has also accelerated the establishment of a circular economy.

Plastic recycling is in the early stage of rapid development. SK Geo Centric looks forward to developing new technologies and business opportunities that the CLP Fund could help foster. We look forward to cooperating with different stakeholders and expect to find opportunities for new technology.

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FAQs

What is the concept of the circular economy? ›

The circular economy is a model of production and consumption, which involves sharing, leasing, reusing, repairing, refurbishing and recycling existing materials and products as long as possible. In this way, the life cycle of products is extended. In practice, it implies reducing waste to a minimum.

What are the four main concepts of circular economy? ›

The collective role of these four concepts of circular economy is to regenerate natural procedures, reduce e-waste and manage pollution.

What is circular economy examples? ›

In a circular economy, manufacturers design products to be reusable. For example, electrical devices are designed in such a way that they are easier to repair. Products and raw materials are also reused as much as possible. For example, by recycling plastic into pellets for making new plastic products.

Why Việt Nam needs a circular economy for plastics? ›

Circular economy approaches can help reduce the pressure on Vietnam's already stressed solid waste management (SWM) infrastructure by designing out wastes . Solid waste volumes have doubled in less than 15 years and are expected to double again by 2030.

Why the circular economy is important? ›

A circular economy can be an important instrument to tackle the current triple planetary crises on climate, biodiversity and pollution. By keeping resources in the loop for longer, we'll avoid emitting greenhouse gases caused by the energy needed to make products.

What are the benefits of circular economy? ›

Five benefits of a circular economy for food
  • It regenerates natural systems. In a circular economy, food is produced regeneratively. ...
  • It combats climate change. ...
  • It can improve access to nutritious food. ...
  • It can support local communities. ...
  • It saves money and creates value.

What are the most important components of a circular economy? ›

The core elements of the circular economy relate to direct circular handling of material and energy flows—for example closing loops, extending product lifecycles and increasing usage intensity.

How do you achieve a circular economy? ›

3 Ways to Transition Toward a Circular Economy
  1. Consume Less. The circular economy focuses on better use of natural resources, and the simple fact is that many of us consume far too much. ...
  2. Consume Better. A circular economy is not only about consuming less; it's also about consuming better. ...
  3. Create Systemic Change.
6 Aug 2020

How does circular economy help climate change? ›

Circle Economy calculates that 62% of global greenhouse gas emissions (excluding those from land use and forestry) are released during the extraction, processing and manufacturing of goods to serve society's needs; only 38% are emitted in the delivery and use of products and services.

Which country has the best circular economy? ›

Japan. Japan is another early circular economy innovator, with a number of policies introduced since the early 2000s to reduce, reuse and recycle. A densely populated, highly industrial and resource-constrained country, Japan adopted ambitious waste-management policies early.

What problems does circular economy solve? ›

The circular economy is a systems solution framework that tackles global challenges like climate change, biodiversity loss, waste, and pollution.

Is circular economy sustainable? ›

The circular economy holds out the hope of living within the planet's resources. Turning aspiration into action is another matter. A little over a year ago, schoolchildren across the globe embarked on huge strikes over the climate emergency.

What environmental challenges does Vietnam face? ›

The following eight problems deserve special attention; 1) deforestation, 2) decrease of agricultural land resources, 3) irrational use of water resources, 4) over exploitation of fishery resources, 5) irrational use of mineral resources, 6) loss of genetic resources, 7) environmental pollution, 8) environmental damage ...

How much waste does Vietnam produce? ›

As an emerging industrial hub with accelerating economic growth, Vietnam has severe environmental issues, particularly in waste management and plastic pollution. The total volume of waste each year in the country is approximately about 25.5 million tons, of which 75 percent goes into landfills.

How much plastic waste does Vietnam produce each year? ›

An estimated 3.1 million metric tons of plastic waste is discharged on land in Vietnam, and at least 10 percent of this goes into the ocean every year.

What have you learned about circular economy? ›

Circular economy is a new production and consumption model that ensures sustainable growth over time. With the circular economy, we can drive the optimization of resources, reduce the consumption of raw materials, and recover waste by recycling or giving it a second life as a new product.

How can a circular economy benefit a business? ›

Research shows that the circular economy offers a $4.5 trillion economic opportunity by reducing waste, stimulating innovation and creating employment. New business models focused on reuse, repair, remanufacturing and sharing models offer significant innovation opportunities.

When did circular economy begin? ›

The CE concept was popularized in China in the 1990 s in response to economic growth and natural resource limitations [6], [7], [8]. The main point of the CE concept is to capitalize on material flow recycling and to balance economic growth and development with environmental and resource use [9].

Is circular economy profitable? ›

In fact, leveraging strategies like circular economy practices in manufacturing creates sustainable profitability: the practices that help manufacturers preserve resources and reduce waste actually help them become more profitable.

Who started circular economy? ›

Popularized by the book Cradle to Cradle: Remaking The Way We Make Things, Cradle to Cradle Design has been widely implemented by architect William McDonough, who was introduced as the "father of the circular economy" while receiving the 2017 Fortune Award for Circular Economy Leadership in Davos during the World ...

Is circular economy the solution? ›

The circular economy provides a solution. It's a new way of doing things that improves the way we manage waste. But it's so much more than that too! It creates business opportunities and protects the environment, by keeping valuable resources and materials in the economy.

How does the circular economy reduce waste? ›

Increasing circularity means moving away from a linear (take-make-dispose) economy, to one where products and materials are reused, repurposed and recycled. This reduction in consumption of raw or virgin material not only reduces waste, but can also reduce the need to extract and process additional raw materials.

What is circular economy waste? ›

It is a change to the model in which resources are mined, made into products, and then become waste. A circular economy reduces material use, redesigns materials, products, and services to be less resource intensive, and recaptures “waste” as a resource to manufacture new materials and products.

How the circular economy tackles biodiversity loss? ›

Eliminate waste and pollution – to reduce threats to biodiversity. In a circular economy, driven by design, waste and pollution are eliminated so these direct threats to biodiversity are reduced.

Is Philippines a circular economy? ›

At present, there is no integrated circular economy strategy or policy framework that exists in the Philippines.

Is the world a circular economy? ›

Our world economy is only 9.1% circular, leaving a massive 'Circularity Gap'. This alarming statistic is the main output of this first Circularity Gap Report, in which we launch a metric for the circular state of the planet.

Is China a circular economy? ›

China and the circular economy

Supported by the country's leadership on circular economy policies, China's cities are well placed to become beacons of successful circular economy transitions.

Why is a circular economy important to achieving the sustainable development goals? ›

The circular economy shifts wealth and prosperity from our current means of consumption to a system that is continuous and long-lasting. It is a system that is regenerative by design, where the needs of all citizens are provided within the natural means of the earth.

What is circular economy and why does your company need to adopt the concept? ›

Keeps products and materials in use

Circular economy favors designing products for durability, reuse, remanufacturing, and recycling to keep materials circulating for as long as possible. It's an economy that encourages many different uses for materials instead of just using them up.

How does the concept of circular economy lead to sustainable living? ›

The first advantage of a circular economy is the protection of the environment, reducing waste and the emissions of greenhouse gases, systematizing recycling, and ending planned obsolescence. The circular economy also allows to decrease the dependence on importation of resources (raw materials, water, energy).

What are the 3 principles of circular economy? ›

Jennifer adds: “It sounds complicated, but the Circular Economy is really based on three simple principles: designing out waste and pollution, keeping products and materials in use, and regenerating natural systems.”

Why is circular waste more sustainable? ›

Under a circular system, countries will need to import fewer materials since more resources are being kept within the economy, lessening the need for transport. When waste is managed in a circular manner, countries are able to neutralize the amount of waste that they produce.

What are the 3 principles of circular economy? ›

Ellen McArthur Foundation's Definition Of Circular Economy

It is based on three principles: design out waste and pollution; keep products and materials in use; regenerate natural systems.”

What is the concept of Blue economy? ›

According to the World Bank, the blue economy is the "sustainable use of ocean resources for economic growth, improved livelihoods, and jobs while preserving the health of ocean ecosystem." European Commission defines it as "All economic activities related to oceans, seas and coasts.

What problems does circular economy solve? ›

The circular economy is a systems solution framework that tackles global challenges like climate change, biodiversity loss, waste, and pollution.

How does circular economy help climate change? ›

Circle Economy calculates that 62% of global greenhouse gas emissions (excluding those from land use and forestry) are released during the extraction, processing and manufacturing of goods to serve society's needs; only 38% are emitted in the delivery and use of products and services.

How do you achieve a circular economy? ›

3 Ways to Transition Toward a Circular Economy
  1. Consume Less. The circular economy focuses on better use of natural resources, and the simple fact is that many of us consume far too much. ...
  2. Consume Better. A circular economy is not only about consuming less; it's also about consuming better. ...
  3. Create Systemic Change.
6 Aug 2020

Is circular economy sustainable? ›

The circular economy holds out the hope of living within the planet's resources. Turning aspiration into action is another matter. A little over a year ago, schoolchildren across the globe embarked on huge strikes over the climate emergency.

When did the circular economy start? ›

The idea of circular flow for materials and energy is not new, appearing as early as 1966 in the book by Kenneth E. Boulding, who explains that we should be in a "cyclical" system of production. For its part, the term "circular economy" appeared for the first time in 1988 in "The Economics of Natural Resources".

Why is blue economy important? ›

"The blue economy" can create jobs, spur economic growth, mitigate the impacts of climate change and help meet the food needs of a growing global population. From sustainable fisheries to maritime renewable energies, there are five crucial areas where the G20 would benefit from investing in the ocean.

What countries have a blue economy? ›

Some countries have also taken it upon themselves to implement strategies and policies that support the idea of Blue Economy. Among these are Denmark and Norway that have a clear focus on the shipping industry.

Is blue economy sustainable? ›

The 'blue economy' concept provides a more holistic vision that embraces economic growth – when it is sustainable and does not damage other sectors. Similar to the 'green economy', the blue economy brings human well-being, social equity and environmental sustainability into harmony.

Why is a circular economy important to achieving the sustainable development goals? ›

The circular economy shifts wealth and prosperity from our current means of consumption to a system that is continuous and long-lasting. It is a system that is regenerative by design, where the needs of all citizens are provided within the natural means of the earth.

What is circular economy and why does your company need to adopt the concept? ›

Keeps products and materials in use

Circular economy favors designing products for durability, reuse, remanufacturing, and recycling to keep materials circulating for as long as possible. It's an economy that encourages many different uses for materials instead of just using them up.

How does the concept of circular economy lead to sustainable living? ›

The first advantage of a circular economy is the protection of the environment, reducing waste and the emissions of greenhouse gases, systematizing recycling, and ending planned obsolescence. The circular economy also allows to decrease the dependence on importation of resources (raw materials, water, energy).

How does the circular economy reduce waste? ›

Increasing circularity means moving away from a linear (take-make-dispose) economy, to one where products and materials are reused, repurposed and recycled. This reduction in consumption of raw or virgin material not only reduces waste, but can also reduce the need to extract and process additional raw materials.

What is circular economy waste? ›

It is a change to the model in which resources are mined, made into products, and then become waste. A circular economy reduces material use, redesigns materials, products, and services to be less resource intensive, and recaptures “waste” as a resource to manufacture new materials and products.

How the circular economy tackles biodiversity loss? ›

Eliminate waste and pollution – to reduce threats to biodiversity. In a circular economy, driven by design, waste and pollution are eliminated so these direct threats to biodiversity are reduced.

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