JX Nippon Oil, SK Innovation to build world’s largest paraxylene plant

JX Nippon Oil & Energy Corp. of Japan and SK Innovation Company of South Korea will build a new 1.35 trillion won (US$1.3 billion) paraxylene plant and a lube base oil plant in South Korea. The new paraxylene plant which will be online in 2014 will be the world’s largest paraxylene plant, with a capacity of one million tons. Feedstock for the paraxylene plant will be supplied by JX Nippon Oil. Under the terms of the joint venture agreement, SK will hold a 50% plus one share in the paraxylene plant. JX will hold the remaining percentage. JX Nippon Oil currently is the top company in paraxylene in Asia. The forecast growth for paraxylene which is made from petroleum and is used in polyester manufacturing, is expected to be strong with rising demand throughout Asia. The new plant will increase JX Nippon Oil’s paraxylene output capacity to 3.12 million tons annually. The new base oil plant has a planned capacity of 1.35 million kiloliters per year. SK has the larger stake in the lube venture, with a 72% share, while JX will own 28%. (August 5, 2011)