OCI today means Organized Corporate Irresponsibility – Opinion

The massive explosion at OCI’s polysilicon plant in Malaysia in August 2024 is only the culmination of a long accident series and result of an irresponsible management. A commenting analysis.

By Johannes Bernreuter, Head of Bernreuter Research

It is time to come clear: As a non-Chinese supplier of polysilicon untainted by forced labor in Xinjiang, the South Korean chemicals group OCI Holdings and its subsidiary OCI Malaysia (OCIM) only seemingly have a clean record. They are themselves tainted by ignoring safety standards to an extent that gambles with human lives: Since 2019, one construction worker, two contractors and two employees have been killed by accidents at OCIM’s polysilicon plant.

Long series of accidents with a high death toll

The factory with an annual polysilicon production capacity of 35,000 metric tons is located in the Samalaju Industrial Park on the north-western shore of Borneo island, about 60 kilometers away from Bintulu in the Malaysian state of Sarawak. As the German section of the Food First Information and Action Network (FIAN) has revealed, the list of accidents at the polysilicon plant, which OCI acquired from Tokuyama Corporation in May 2017, is much longer than has been known so far. Using information from FIAN and Malaysian media reports, Bernreuter Research has reconstructed the following timeline:

• 2019 or 2020: A construction worker dies after falling from great height.
• October 11, 2019: A fire breaks out at the plant, nourished by “hydrogen materials mixed with silicon” – apparently in the bottom area of a fluidized bed reactor for hydrochlorination. No injuries are reported; however, a photo shows that firemen from the local Fire and Rescue Department and the factory’s Emergency Response Team are not wearing any protective gear, which betrays a serious lack of safety culture.
  Between 2019 and 2022:
• Another fire is reportedly kept by OCI from the public.
• A hydrogen compressor explodes. One worker is injured.
• A worker, who does not wear protective clothes, suffers second-degree chemical burns from a splash.
• May 9, 2022: Two contractors are killed and at least two more workers are injured by the explosion of a tank containing an undisclosed chemical.
• May 2024: An accident “similar” to the explosion in August 2024 occurs. Details are unknown.
• August 14, 2024: The explosion of the main gas feed pipe to the bottom of a hydrochlorination reactor injures ten workers. Two employees succumb to their injuries a few weeks later.
• January 22, 2025: An explosion is supposedly caused by the hydrogen gas leak of a filter vessel in the A1 Section of Polysilicon Plant 1 (PS 1). No one is injured.

Some of these events resemble earlier accidents at Wacker’s U.S. polysilicon plant in Charleston, Tennessee: the fatal fall of two construction workers from great height (October 2012), chemical burns (August 2017 and July 2020), the explosion of a hydrogen compressor (September 2017) and the fire in a waste water treatment building (May 2019). Except for the construction accident, all other incidents occurred during the tenure of site manager Mary Beth Hudson, who was obviously overwhelmed with her task.

Hudson left the company only after a contract worker was killed by an accident in November 2020. Since her successor Ken Collins, an experienced environmental, health and safety professional, took over as site manager in August 2021, no incident at the plant in Charleston has become known anymore.

That illustrates what expert Alan Crawford states in his in-depth analysis of the August 2024 accident at OCIM: “First-hand experience working in the global polysilicon and silicone industries since 1989 shows that the overall ‘safety culture’ of these sites is driven by a top-down approach from upper management (CEO/owner level). Upper management must demand that site operations and maintenance be conducted at the highest level of overall safety.”

Dumping chemical waste into the sea

Could it be that OCIM’s management is overwhelmed with its task as well? No, it is worse: There are indications that the management is choosing profit over safety. A former employee told FIAN Germany the following: “These Koreans in top management put money as number one. They don’t care about safety. So. when we say, ‘We have to stop the work because it’s dizzying and dangerous,’ then they call us: ‘Come back here.’”

FIAN has also got information that OCIM has repeatedly dumped chemical waste into the sea. This poses a severe problem for neighboring indigenous fisherpeople and farmers: “The marine pollution caused by the wastewater from OCIM and the other factories [in the Samalaju Industrial Park] is threatening their sources of food and income,” FIAN explains.

In light of OCIM’s practice, the environmental and governance statements on the website of its South Korean parent company sound like hollow phrases: “We lead a sustainable future by responding to climate change and managing environmental impact through the establishment of a robust environmental management system. (…) OCI Holdings establishes systematic plans and operates programs for company-wide safety and health management.”

If OCI does not change its course, responsible buyers should draw consequences

The reality looks different: OCI Holdings is clearly covering up for the local management in Malaysia. The parent company has not wasted any words on the August 2024 accident up to now. It did not even find worth it to respond non-publicly to a draft of the accident analysis that author Alan Crawford had sent to the company.

The only “reaction” to the accident was a press release on October 7 praising OCI’s hosting of a one-day badminton class with a Koran star player and a running event in Sarawak as “significant strides” to “develop stronger relationships with key figures and local residents” and to “promote health among local residents.” In the face of two killed and eight injured employees as well as the indigenous neighbors damaged by OCIM’s chemical dumping, this is pure cynicism.

OCI was founded as Oriental Chemical Industries in 1959 and renamed itself DC Chemical in 2001 before it returned to the acronym OCI in 2009, then interpreted as “Origin of Chemical Innovation.” When it comes to the polysilicon plant in Malaysia, however, OCI today means Organized Corporate Irresponsibility. Moreover, the company’s hazardous and secretive policy is favored by a lack of stringent oversight through the authorities in Malaysia. Announcements without consequences and empty threats by single politicians seem to substitute an effective control of safety standards.

What is the conclusion? Hanwha Solutions, the parent company of solar module supplier Qcells, has replaced Longi as OCIM’s largest customer; Trina Solar and VSUN have also closed polysilicon supply contracts with the company. If OCI does not change its irresponsible course, responsible buyers that consider purchasing solar modules from Qcells, Trina or VSUN, fund managers as well as environmental, social and governance (ESG) rating agencies have to think twice: Is a polysilicon manufacturer that endangers the lives of its employees, severely pollutes the environment and thus jeopardizes the livelihood of indigenous people any better than a competitor that procures silicon metal made with forced labor in Xinjiang? For everyone with a minimum of ethical sense, the answer should be clear.

Update

On Febrary 5, OCI Malaysia renamed itself OCI TerraSus Sdn Bhd to reflect “our ongoing commitment to innovation, sustainability, and our bright future in the industry.” This again demonstrates that OCI is only capable of superficial greenwashing instead of admitting and addressing the real problems at the polysilicon plant in Malaysia.