Lotte Chemical’s Johor plant needs to pass DoE smell test

Stop order will not be lifted until Lotte fulfils all the DoE requirements


The stop order issued on Lotte Chemical Titan Holding Bhd’s plant in Johor will not be lifted until the Department of Environment (DoE) completes its extensive daily monitoring exercise on the level of odour emission.

Natural Resources and Environment Minister Datuk Seri Dr Wan Junaidi Tuanku Jaafar (picture) said Lotte will report daily to the DoE on the odour emitted from the KBR-Catalytic Olefins Converter plant within its TE3 Project in Pasir Gudang.

“The stop order will not be lifted until the company fulfils all the DoE requirements and (necessary) upgrading,” he told The Malaysian Reserve.

The DoE issued a stop-work order on Lotte’s factory after the plant was identified as the source of a stench, which had reached neighbouring Singapore.

Wan Junaidi said the DoE chaired a meeting with Lotte yesterday, and the department has issued a list of demands which must be complied by Lotte before the stop-work order can be lifted.

In the meeting, Lotte had also proposed to organise a dialogue with the island republic’s authorities to work on a win-win solution.

Wan Junaidi said among the DoE’s demands includes the need for Lotte to upgrade its portable monitoring for volatile organic compound (VOC) that can measure up to parts per billion (ppb).

The upgrade for strict testing to the level of ppb is to ensure that the odour due to volatile organic carbon can be totally eliminated.

Lotte also needs to install an additional pollution parameter called total organic compound (TOC) and implement a full Guided Self-Regulation (GSR).

Essential elements of GSR include performance monitoring and continuous emission monitoring systems (CEMS) where operators can record all related data on pollutant emissions. The data can also be communicated to the DoE via an online system.

Wan Junaidi said Lotte will complete the installation of six more CEMS by 2019, to enable sustainable operations.

The DoE issued the stopwork order to Lotte effective Oct 1 due to odour emission and surface oil sheen/film discharge resulting from a culmination of the reaction of hot water from the TE3 Project poured into the waste water treatment plant containing pygas and pump failure at the waste water treatment plant.

The commissioning and the commercial startup of the TE3 Project is slated for the final quarter of this year. Lotte, however, is confident that the project is still on track despite the hiccups.

Lotte’s shares on Bursa Malaysia closed at RM5.07 yesterday, slightly lower than RM5.08 on Tuesday. Some 1.9 million shares exchanged hands.

Shares of South Korean-controlled petrochemical producer closed below RM5 after news of the DoE’s stop-work order.

On Sept 21, a small fire broke out at the site of the TE3 Project due to contact between residual vapour from the quench water drain pit and the steam line.

Lotte said no other plants were damaged, while the estimated losses to replace burnt cables would not exceed RM50,000.

The company which debuted on Bursa Malaysia in July, was Malaysia’s biggest initial public offering since 2012.