Korea's oil refiners shoot for cleaner-burning fuels

Korean oil refiners, including SK Energy Co., the nation’s leading crude processor, will spend 10 trillion won (US$9.6 billion) to produce more premium fuels over the next five years, an industry association said. The expansion will further improve the competitiveness of Korean refiners in the global market,” the Korea Petroleum Association said in a statement in mid-July, also referring to GS Caltex Corp., S-Oil Corp. and Hyundai Oilbank Co. Cho Sang-bum, a spokesman at the association, declined to give details on the companies’ investment plans. Refiners want to increase their ability to turn cheaper oil grades into higher-priced, cleaner-burning fuels to meet demands from China and India and satisfy emissions standards in export markets such as the United States and Europe. Exports of premium fuels accounted for 53.3% of refiners’ revenue in 2007, up from 34.1% in 2001, the association said. SK Energy, which has three units that can turn low-grade oils into cleaner fuels, said in April that it would build a 1.5 trillion-won (US$1.44 billion) unit by 2011. GS Caltex, Korea’s second largest refiner, will spend 2.9 trillion won (US$2.78 billion) to construct a third unit to upgrade heavy oils by 2010. (July 19, 2008)