March 20, 2026 [Reuters]- South Korean authorities have received a restructuring plan for the country’s largest petrochemical complex in Yeosu, the Industry ​Ministry said on Friday, marking a key step in ‌the government’s push to overhaul the struggling sector.

The plan involves Yeochun NCC — a joint venture between Hanwha Solutions and DL Chemical — integrating with ​Lotte Chemical’s Yeosu naphtha cracking centre (NCC) to form a ​new consolidated entity.

Downstream assets, including DL Chemical’s polyethylene unit ⁠and other businesses from Hanwha Solutions and Lotte Chemical in ​the region would also be folded into the new company.

The ministry ​said the restructuring plan also involved the adjustment of some naphtha cracking and commodity chemical facilities, while the new entity would pivot toward high-value products such ​as medical-grade low-density polyethylene, and functional polyolefin elastomers for automotive ​and power cable applications.

“While pursuing the mid-to-long-term industrial policy of… restructuring, we ‌will ⁠do our best to support securing naphtha supply for petrochemical companies to stabilise supply chains,” Industry Minister Kim Jung-kwan said.

The ministry said it would convene a committee to review the plan, and that ​a tailored government package — ​covering financing, tax ⁠incentives, research and development and regulatory relief — would be prepared, similar to support offered for ​the restructuring of the Daesan petrochemical complex earlier this ​year.

South Korea’s ⁠government has been putting pressure on a petrochemical sector it says is in “crisis” to speed up restructuring to boost efficiency and ⁠raise flagging ​margins.

The latest plan comes after 10 ​South Korean petrochemical companies last year agreed to restructure their operations, including large ​cuts to their naphtha-cracking capacity.