CHINA – Covestro AG has signed a tripartite cooperation agreement with South Korean petrochemical major SK Geo Centric and Finland-based engineering service company Neste to produce biodegradable polyurethane raw materials.
Under the agreement, Neste will 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.
This feedstock will be processed at SK geo centric’s facilities in South Korea into benzene and supplied to Covestro to use as raw material for methylene diphenyl diisocyanate (MDI) at its site in Shanghai, China.
Methylene diphenyl diisocyanate (MDI) is a key raw material for the manufacture of rigid polyurethane foam, which is a well-proven insulating material for buildings and used in the cold chain helping to save CO2 emissions and reduce energy consumption during its product life.
Replacing traditional fossil-based feedstock with Neste RE provides a significant reduction in greenhouse gas (GHG) emissions.
It also reduces the carbon footprint of the polyurethane raw materials produced by Covestro and of downstream industries.
The cooperation marks the start of possible future collaborations between the three companies, aiming at replacing fossil feedstocks with more sustainable ones in the production of polymers and chemicals in the APAC region and beyond.
“Through this collaboration, we would continue to ramp up the market for sustainable alternative materials. This enables us to supply our customers in Asia-Pacific (APAC) with more sustainable MDI, based on mass-balanced raw materials,” said Sucheta Govil, Chief Commercial Officer of Covestro.
Commenting on the deal, Mercedes Alonso, Executive Vice President, Renewable Polymers and Chemicals at Neste said: “As renewable solutions become more available, their usage in the chemical industry can now start to be scaled up.”
“To make this ramp-up a success, we’ll need to establish collaborations along the value chain – and this one between three sustainability-minded partners is a prime example of how the industry can do just that,” she added.
The first renewable benzene based on Neste Re renewable feedstock has already been produced and shipped by SK geo centric.
Under a strategy it calls “Green for Better Life,” SK geo centric has announced a target to become “net zero” before 2050.
The company says it will drive its business transformation by expanding its renewable products portfolio, and that it will “respond to increasing global demands in the market by leveraging the strong synergies between collaboration partners.”
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