20 Aug 2014 New boost for SA’s PET recycling
The new plant, which would be owned by newly-formed company Mpact Polymers, in which Mpact holds 79% and the IDC 21%, was expected to be commissioned during the second half of 2015.
Mpact CEO, Bruce Strong, said the company believed this to be a suitable investment as the company already had an established paper collection network, which could be expanded to include the collection of PET bottles. Mpact was also a significant producer of PET packaging.
“Given the network in our recycling business, we thought we could use that to collect bottles which we could then beneficiate to produce a raw material that would help reduce the costs of the raw materials for our customers, [while also] improving the environmental credentials of our business and the sector,” he said.
He added that the facility was also a good investment, which would enhance Mpact’s shareholder returns.
The IDC had provided loan funding of R210-million in debt, as well as a further R30-million for its equity stake in Mpact Polymers, while the DTI had approved a Section 12I tax incentive.
“The new plant will process about 29 000 t/y of PET plastic bottles, generating 21 000 t of new raw material directly from what was previously considered waste material that would have been sent to landfill. This raw material is commonly referred to as rPET,” Mpact stated, adding that it expected the project to deliver about 1 000 direct and indirect job opportunities.
“Collecting and processing 29 000 t of PET bottles amounts to a saving of about 180 000 m3 of landfill space each year, the equivalent of 75 Olympic-size swimming pools”
Strong added that the company’s entry into plastic recycling was an exciting opportunity, which would add an important dimension to its business.
“It is an excellent fit with our strategy and will enhance our position as a leading beneficiator of recyclables in South Africa,” he commented.
The company stated that the development of the plant for PET recycling was done in close collaboration with key customers to ensure that the processed recycled material met international standards.
Mpact worked with Coca-Cola, its bottling partner Amalgamated Beverage Industries (ABI), SABMiller and industry body PETCO to bring the project to fruition.
ABI would be the anchor customer for the rPET produced by the plant.
“When suppliers and customers work together, we are able to achieve solutions that benefit all stakeholders. This is a solution that we, as customers, have been seeking and [we] are excited that Mpact has responded with this R350-million investment. This will not only benefit business but will create jobs and, most importantly, address environmental concerns,” ABI MD, John Ustas, commented.
Source: Mpact