S Korea’s S-Oil to build $7bn Shaheen petrochemical project in Ulsan

SINGAPORE (ICIS)–South Korea’s S-Oil announced on Thursday a won (W) 9.3tr ($7bn) plan to build new petrochemical units in Ulsan, South Korea, including a mixed-feed 1.8m tonne/year cracker.

The project called Shaheen will be located at S-Oil’s existing site in Ulsan and will produce around 3.2m tonnes/year of petrochemical products by the time it is completed in 2026.

“The $7bn Shaheen project aims to convert crude oil into petrochemical feedstock and would represent the first commercialisation of Aramco and Lummus Technology’s TC2C [thermal crude to chemicals] technology, which increases chemical yield and reduces operating costs,” S-Oil’s parent firm Saudi Aramco said in a separate statement.

The project marks Saudi Aramco’s biggest ever investment in South Korea and follows an earlier $4bn investment into the first phase of the petrochemical expansion completed in 2018.

The steam cracker is expected to process by-products from crude processing, including naphtha and off-gas, Aramco said.

The project is expected to produce 580,000 tonnes/ year of ethylene; 770,000 tonnes/year of propylene; 200,000 tonnes/year of butadiene (BD) and 280,000 tonnes/year of benzene, S-Oil said in a regulatory filing.

The South Korean refiner also plans to build a 880,000 tonnes/year linear low density polyethylene (LLDPE) unit and a 440,000 tonnes/year high density polyethylene (HDPE) plant as part of the project.

($1 = W1,342)