LyondellBasell failed to reach its weight goal for producing and selling recycled and renewable-based resins last year, even as the global plastics producer looks to borrow $500 million for “green” projects.
In various financial filings, the major polyolefins producer recently disclosed data on its recycled resin sales, global recycling facility investments and its plans for borrowing big to finance sustainability-related projects.
2022 Circulen sales fall short
The company’s goal is to produce and market 2 million metric tons of recycled and “renewable-based” polymers annually by 2030. These polymers are sold under the company’s Circulen product portfolio.
The company’s sustainability report emphasizes the 2030 goal and the fact that the company has produced and sold 175,000 metric tons of Circulen since 2019, but it does not provide data on annual sales, and neither do the company’s financial filings.
However, in a recently published proxy statement for the 2023 annual meeting of shareholders, the company disclosed that it sold less than 80,000 tons of its Circulen polymers in 2022, short of the company’s 150,000 tons goal for 2022. The number was included in that document because Circulen sales are one factor in how bonuses for executives are calculated.
LyondellBasell achieved its 2022 goals for renewable energy power purchase agreements, implementation of carbon dioxide-reduction projects and making progress developing its MoReTec chemical recycling technology at a pilot plant in Ferrara, Italy. The Circulen target was the only one that fell short.
In 2022, 10% of the payouts under the annual executive bonus program were tied to those four metrics.
Last fall, LyondellBasell signed a supply agreement to purchase recycled resin from reclaimer Envision Plastics.
Plans for recycling plants
The proxy form also noted the company’s plans to invest in recycling facilities around the world, to help boost Circulen production.
The company announced plans to form joint ventures to build and operate recycling plants in China and India, with the facilities expected to come on-line this year and next year, respectively.
The company last year also formed a joint venture called Source One Plastics, which will build a scrap sorting and recycling facility in Germany. That plant will provide feedstock to LyondellBasell’s MoReTec chemical recycling facility in Wesseling, Germany.
The proxy statement also noted the ongoing collaboration with Cyclyx International and ExxonMobil to build a plastic sorting and processing facility in the Houston area.
“The new facility would address a critical missing link in the plastic waste supply chain by connecting community recycling programs to new and more advanced recycling technologies that have the potential to take a much wider variety of plastic materials,” the document noted.
On April 29, LyondellBasell reached an agreement to buy out Veolia’s 50% ownership in the Quality Circular Polymers (QCP) joint venture in Belgium and the Netherlands. QCP has the capacity to recycle 55,000 metric tons of plastic a year.
Half a billion in borrowing
LyondellBasell announced that it will issue $500 million worth of green bonds, which will fund various sustainability efforts. Other plastics producers, including Indorama Ventures, have issued sustainability bonds, but this is a first for LyondellBasell.
The proceeds of the notes offering will be used to finance or refinance new and/or existing “green projects,” including those related to circular economy adapted products, technologies and processes; renewable energy; pollution prevention and control; and energy efficiency.
In terms of recycling, the money could be used for R&D, manufacturing and distribution of products made with mechanically or molecularly recycled feedstocks, as well as bio-derived resins, according to a prospectus supplement filed with the SEC.
To show the impact of the financing, LyondellBasell will report a variety of metrics, including metric tons mechanically recycled, metric tons chemically recycled, metric tons of bio-derived plastic produced and metric tons of Circulen brand polymers sold.
