South Korea's SK Innovation has suspended construction of an almost completed paraxylene plant in Incheon, in the country's west coast, after local authorities accused the company of violating the city's building codes, the company said Tuesday.
"We have decided to temporarily suspend the construction in response to the request of local authorities," a company official told Platts. The company has already pulled all workers from the construction site, he said, adding that construction had stopped last weekend.
The official also said SK Innovation would take measures to resolve the alleged violation of the building code while construction is suspended.
"We cannot say how long the suspension will last at the moment. The company would try to fully address concerns of residents and the local authorities," the company official said.
The Seo-gu district office in Incheon City, west of Seoul, has sent a notice to SK Innovation to halt the construction three times -- in October, December and on January 16, saying the company has violated the city's building code.
The Seo-gu district office said the company is building the plant in an area exceeding what was permitted by the city authorities. "Out of 472 blocks in the construction, 54 were not permitted," said an official at Seo-gu.
The Seo-gu district office's move came after local residents staged protests, claiming that the plant would generate toxic materials. Park Jong-Hwan, who leads the residents' protest said they will stage a massive rally on February 7 to call for scraping of the project.
"What we want is not a suspension of the construction for days or weeks. We want the project to be canceled once and for all," Park said in a statement.
SK Innovation started work on the Won 1.6 trillion ($1.5 billion) paraxylene plant with a capacity of 1.3 million mt/year in August 2012 and was aiming to bring it on stream in July this year. The construction is currently 90% complete and the company has spent Won 1.5 trillion so far, according to SK Innovation.
The company official said the suspension of construction would cost Won 100 billion a month.
