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Partnership Aims to Create Value Chain for Renewable-Attributed MDI

Image courtesy of SK geo centric first shipment
First shipment of renewable benzene leaves Ulsan harbor in South Korea.
Covestro, petrochemical company SK geo centric, and Neste collaborate to enable production of polyurethane raw materials based on renewables.

Covestro, South Korean petrochemical company SK geo centric, and Neste announced today a collaboration to enable the production of a major polyurethane raw material based on renewable raw materials via mass balance. The cooperation will see Neste provide SK geo centric with renewable Neste RE, an ISCC-certified feedstock for polymers and chemicals made from 100% renewable raw materials such as waste and residue oil and fats.

SK geo centric will process this feedstock into benzene at the company’s facilities in South Korea and supply it to Covestro for use as a raw material for methylene diphenyl diisocyanate (MDI) at its site in Shanghai. MDI is a key raw material for the manufacture of rigid polyurethane foam, used as an insulating material for buildings and in the cold chain. It helps to save CO2 emissions and reduce energy consumption during its product life, said Covestro in the news release.

The cooperation marks the start of possible future collaborations between the three companies, aiming at replacing fossil feedstocks by more sustainable alternatives in the production of polymers and chemicals in the APAC region and beyond.

"With renewable solutions available, we are now entering the phase of scaling up their usage in the chemical industry," said Mercedes Alonso, Executive Vice President, Renewable Polymers and Chemicals at Neste. "This will be crucial in replacing the vast amounts of fossil resources the industry is currently depending on. To make this ramp-up a success, we’ll need to establish collaborations along the value chain. This one between three sustainability-minded partners is a prime example of how the industry can do just that,” added Alonso.

Replacing the common crude oil-based fossil feedstock with Neste RE provides a significant reduction in greenhouse gas (GHG) emissions, thereby improving the carbon footprint of the polyurethane raw materials produced by Covestro and of downstream industries, said the company.

"I am much pleased that through this collaboration we continue to ramp up the market for sustainable alternative materials. This enables us to supply our customers in Asia-Pacific with more sustainable MDI based on mass-balanced raw materials," said Sucheta Govil, Chief Commercial Officer of Covestro. "Using such materials is attractive because it will also help them achieve their climate goals. Another core benefit of this line of products is that it is a technical drop-in solution that our customers can use immediately without a major changeover in their plants."

“SK geo centric will actively work with Covestro and Neste, as we mark the first collaboration of this kind in the Asia-Pacific region. We remain committed to expanding this cooperation,” added Woohyuk-Choi, Vice President of SK geo centric’s Aromatic Business Unit.

Under the Green for Better Life strategy, SK geo centric announced its ambitious target to become net-zero before 2050. To fulfill its responsibility, the company will drive its business transformation by expanding its high-quality renewable products portfolio. SK geo centric will respond to increasing global demands in the market by leveraging the strong synergies between collaboration partners.

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