Plazen-Dongseo Power to Build 100,000-Ton Annual Clean Methanol Production Facility in Taebaek City

by Lee Sang-bok (Plagen (Google Translation)) - Ssangyong Construction, Hanbit Energy, and Infrastructure Frontier Asset Management also participated. - Taebaek City, whose population is decreasing due to mine closure, transforms into a clean energy city -- Plazen will build a clean methanol (green methanol) production facility with an annual capacity of 100,000 tons in Taebaek, Gangwon-do, along with Dongseo Power and others.

Plazen and Taebaek signed a business agreement for a green methanol production project that included these details in the Taebaek City Hall conference room on the afternoon of the 3rd. They decided to first build an annual 10,000-ton clean methanol production facility by 2027 using the regional revitalization investment fund and then increase production in the future.

Dongseo Power, Hyundai Corporation, Ssangyong Engineering & Construction, Optimum Trading, Hanbit Energy, LF Energy, Estech Korea, and Infra Frontier Asset Management also participated in this agreement.

They plan to share the sourcing of raw materials, plant manufacturing and installation, operation, purchase of produced clean methanol, carbon emission rights, and project financing. This is the first time in Korea that a commercial-scale clean methanol plant is being built.

The idea is to transform Taebaek City, which once contributed to the national economic development as an anthracite coal production base but is declining due to the mine closure policy, into a clean energy industrial city and be reborn as a carbon-neutral center.

Taebaek City’s regional economic foundation has been weakened by the final closure of the Korea Coal Corporation’s Jangseong Mine at the end of June this year. According to Statistics Korea, the population of Taebaek City as of December last year was 38,702, a sharp decrease from 120,000 20 years ago to one-third.

At the signing ceremony, Taebaek Mayor Lee Sang-ho said, “As the coal mining industry, which was the mainstay of the regional economy, is declining, the city is rapidly becoming at risk of extinction.” He continued, “The conversion into a clean methanol production base, which will become a touchstone for the government’s major policies of realizing carbon neutrality and achieving balanced regional development, is an opportunity to open a new decade for the future.”

The mayor emphasized once again that “the older generation has a responsibility to specialize Taebaek City as an energy source development and production city to give a gift to future generations,” and that “the construction of clean methanol production facilities is a great opportunity to leap forward as a future resource city.”

Chairman Kim Sang-hyeop of the 2050 Carbon Neutral, Green Growth Committee directly under the president said, “Clean methanol is receiving significant attention in the global renewable energy source market, and our forest resources are very advantageous.”

Meanwhile, Taebaek City is considered the optimal region for clean methanol production due to its abundant forest resources, which are raw materials for green methanol, and renewable energy infrastructure. Currently, the Ministry of Strategy and Finance is conducting a preliminary feasibility study to build a 100,000-ton clean methanol industrial complex on the site of the Jangseong Mine in Taebaek City and construct an annual production plant with an annual capacity of 22,000 tons.

Business operators expect that if government support is provided, the construction of a clean methanol production base with an annual capacity of more than 100,000 tons will proceed smoothly.

Taebaek City Mayor, Dongseo Power Vice President Lee Young-chan, and Plagen CEO Kyung Gook-hyun are greeting at the signing ceremony.

Clean methanol is produced by separating biomass, a forestry byproduct, into hydrogen and carbon monoxide through a catalytic chemical reaction with steam at a high temperature of 800℃ or higher and synthesizing them. Compared to gray methanol produced using coal or oil as raw materials, it can reduce carbon dioxide by 5.5 tons per ton of clean methanol.

The International Maritime Organization (IMO) has adopted the '2023 Greenhouse Gas Reduction Strategy' to reduce carbon emissions from international shipping by 100% (Net-Zero) by 2050, and plans to begin full-scale regulations in 2027. This is the background against which shipping companies have begun ordering methanol-powered ships that use clean methanol, a carbon-neutral fuel, as fuel.

In this regard, the government announced a Korea-US green shipping route construction cooperation plan at the 27th United Nations Framework Convention on Climate Change Conference of the Parties in 2022 in order to proactively respond to international environmental changes.

The goal is to conduct a pilot operation of container ship routes and car carrier routes between Busan and Ulsan Ports and Seattle and Tacoma Ports in the US in 2027. The plan is to supply clean fuel produced through the Taebaek City Clean Methanol Project as ship fuel for the Korea-US green shipping route.

There is still no domestic clean methanol production. The Ministry of Oceans and Fisheries aims to produce 500,000 tons of clean methanol domestically per year by 2030.

Kyung-Gook Hyun, CEO of Plagen, said, “We will produce 100,000 tons per year, which is 20% of the domestic clean methanol production target by 2030, in Taebaek City to contribute to the revitalization of the local economy and national energy security.” READ MORE