Hyundai Oilbank to partner with Shell in base oil project

The smallest of South Korea’s oil refiners, Hyundai Oilbank, will enter the lubricating base oil business by partnering with Shell, the company announced. It will build a 20,000 barrel-per-day plant in October at its refining complex in Daesan, 140 kilometers southwest of Seoul. The plant is expected to be on stream by 2014. Hyundai Oilbank will have the majority stake in the joint venture with 60%, while Shell will get a 40% stake. The amount of the investment was not announced. Under the agreement which was signed in Singapore, the two refiners will form a joint venture named Hyundai Shell Base Oil in March. Most of the base oil produced at the plant will be supplied to Shell, which will then distribute the product globally. Hyundai Oilbank said it expects to generate 700 billion won (US$625.4 million) in sales from the joint venture by 2015. (February 7, 2012)