Lee Gyu-lee is a business writer at The Korea Times, focusing primarily on IT & telecommunications, the Ministry of Trade, Industry and Energy and KOTRA. Prior to this, she has covered a wide range of cultural news, from film, television and K-pop to lifestyle and fashion.
S-Oil's Shaheen project to boost Korea's petrochemical competitiveness
S-Oil’s oil refining and petrochemical facilities in Ulsan / Courtesy of S-Oil
By Lee Gyu-lee
New facility aims to improve cost efficiency, stabilize supply chains, shift industry toward higher-value products
S-Oil said Tuesday that its Shaheen project, a massive petrochemical facility expansion which is under construction with commercial operations targeted for next year, will help strengthen the global competitiveness of Korea’s petrochemical industry.
The company said the project could help the industry shift toward higher-value products by introducing advanced technologies and highly efficient facilities, as the sector grapples with oversupply and declining profitability.
According to S-Oil, the Shaheen project is being built with a production base focused on cost competitiveness, energy efficiency and flexibility in feedstock use.
The project will feature the world’s first commercial application of thermal crude-to-chemicals (TC2C) technology, which converts crude oil and low-value fractions from the refining process into petrochemical feedstocks.
It combines high-efficiency facilities with process optimization technologies to improve feedstock and energy efficiency. Additional improvements are expected to reduce carbon emissions by more than 20 percent from the original design.
The facility will be capable of using a range of feedstocks, reducing reliance on any single source and allowing greater flexibility in its feedstock mix. Its integrated refining and petrochemical production system is also expected to help the company better respond to fluctuations in feedstock prices and supply caused by global supply chain disruptions.
Some of the basic petrochemical products connected to the Shaheen project, including ethylene and propylene, will be supplied to downstream manufacturers in the Ulsan National Industrial Complex through dedicated pipelines.
S-Oil said this will improve feedstock supply stability and logistics efficiency, helping strengthen the competitiveness of Korea’s overall petrochemical value chain.
The company said a globally competitive production base for basic petrochemicals is essential for the industry’s shift toward higher-value products. Without cost competitiveness at the basic feedstock stage, even high-value specialty products could struggle to offer competitive prices in global markets, it said.
Large-scale investments in integrated refining and petrochemical facilities are continuing in China and the Middle East, including crude-oil-to-chemicals (COTC) projects that directly convert crude oil into petrochemical feedstocks.
Against this backdrop, S-Oil said the restructuring of Korea’s petrochemical industry should focus not only on reducing excess capacity but also on strengthening overall competitiveness through investments in competitive facilities, the low-carbon transition, a shift toward higher-value products and stronger supply chain stability.
“Shaheen is a long-term investment aligned with the government’s efforts to strengthen industrial competitiveness and secure advanced, highly efficient facilities,” an S-Oil official said.
“Through the successful completion and stable operation of the project, we will make a tangible contribution to helping Korea’s petrochemical industry achieve sustainable competitiveness in global markets.”