Riyadh: The Kingdom of Saudi Arabia’s Aramco, the world’s largest oil company on Thursday announced its largest ever investment in South Korea for a project to develop a world-class integrated petrochemical steam cracking facility through its S-Oil unit, the Saudi Press Agency (SPA) reported.
This comes in an effort by the company to expand its business in the petrochemical sector, and in line with its strategy to maximize the value chain in converting liquids into chemicals.
Aramco said in a statement that the project, which bears the name Shaheen, with a value of 26 billion Saudi Riyals ($ 7 billion), aims to use innovative technology for the first time to convert crude oil into chemical raw materials.
This will mark the first commercialization of pyrolysis technology from Saudi Aramco and Lumos Technologies, which increases chemical production and reduces operating costs.
This project follows a previous investment of $4 billion in the first phase of the petrochemical expansion project, which was completed in 2018.
The project is located at the current site of the (S-Oil) complex in Ulsan. The project is scheduled to have the capacity to produce up to 3.2 million tons of petrochemicals annually, and will include a facility to produce high-value polymers.
The project is expected to start in 2023 and be completed by 2026.
The steam cracker is expected to process by-products from ore processing, including naphtha and by-gases, to make ethylene, and is also expected to produce propylene, butadiene, and other basic chemicals.
Aramco said that upon completion of the project, S-Oil chemical production could double in volume to 25 percent.
“Aramco’s investment in the Shaheen project in South Korea is a quantum leap and a new stage in the company’s refining and chemicals sector,” said Amin Al-Nasser, President and Chief Executive Officer of Saudi Aramco.
The announcement of the project coincides with the visit of Saudi Crown Prince Mohammed bin Salman to South Korea on Thursday.
It is noteworthy that Aramco is the majority shareholder in S-Oil, with more than 63 per cent owned through its subsidiary, Aramco Overseas B V.
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