By IN-SOO NAM
SEOUL -- SK Global Chemical said it has signed a final agreement with Chinese state refiner Sinopec for a $2.9 billion petrochemical joint venture.
Production at the plant in Wuhan, central China, will start in the second half of the year, SK said in a statement. The plant will have annual capacity of about 2.5 million tons of petrochemical products, including ethylene, it said.
An initial agreement on the project was signed in December 2011.
SK Global Chemical will own 35% of the project, the largest petrochemical joint venture between the two countries, while Sinopec holds the remaining stake, it said.
The deal comes during South Korean President Park Geun-hye's four day visit to China this week, which was accompanied by the largest-ever South Korean business delegation to China of 71 corporate bosses, including SK Innovation Vice Chairman Koo Ja-young.
Ethylene is widely used as a feed stock material to produce various petrochemical products, including polyethylene and polyvinyl chloride used in plastics.
Dow Jones Newswires