PLAGEN Secures Investment for Green Methanol Production in Korea

PLAGEN, a leading green methanol production company based in South Korea, has signed a significant investment agreement with Taebaek City to establish a new green methanol facility. This agreement marks a pivotal step in the city's transition from its historic reliance on coal mining to becoming a center for clean energy. The planned facility will produce 10,000 tonnes of green methanol annually and is set to be the first commercial-scale green methanol plant in Korea.

The construction of this plant, funded by the Regional Revitalisation Investment Fund, is scheduled to begin in the first half of 2025, with operations expected to commence in the second half of 2027. The project brings together multiple stakeholders, including Taebaek City, PLAGEN, Korea East-West Power, Hyundai Corporation, Ssangyong E&C, Optimum Trading, Hanbit Energy, LF Energy, and Infrastructure Frontier Asset Management. These partners will collaborate on various aspects of the project, including raw material procurement, manufacturing, engineering, procurement, construction (EPC), operation, and maintenance. They will also oversee the purchasing of the green methanol produced, carbon credit procurement, and project financing.

The closure of Taebaek’s coal mining industry at the end of June, which had been a cornerstone of the local economy, has raised concerns about urban decline. However, the city’s rich resources of forest residues and existing renewable energy infrastructure, such as wind power, create an ideal environment for green methanol production. This development aligns with national objectives for carbon neutrality and regional economic revitalization.

In addition to the local project, a feasibility study is underway by Korea’s Ministry of Economy and Finance to explore the construction of a larger industrial complex for green methanol production at the Jangseong Mine site in Taebaek City. This complex would include a 100,000 tonnes/year green methanol facility and a 22,000 tonnes/year production plant. PLAGEN anticipates that with strong government support, the development of the methanol production base will progress smoothly.

The green methanol produced at the Taebaek facility will be used as fuel for ships operating on the US-Korea Green Shipping Corridor, a key project expected to commence in 2027. This corridor, which will connect Busan-Ulsan Port with Seattle-Tacoma Port, represents a groundbreaking initiative for trans-Pacific green shipping. The Korean government announced its collaboration with the United States to establish this corridor during the 27th Conference of the Parties to the United Nations Framework Convention on Climate Change in 2022.

John Kyung, CEO of PLAGEN, highlighted the project's impact, stating, “We aim to produce 100,000 tonnes of green methanol annually in Taebaek City by 2030, which will account for 20% of Korea’s domestic green methanol production target. This effort will significantly contribute to the revitalization of the local economy and enhance national energy security.” Currently, Korea does not have any domestic green methanol production, making this initiative a crucial step towards achieving the Ministry of Oceans and Fisheries' goal of producing 500,000 tonnes of green methanol per year by 2030.