On March 9, S-OIL held a groundbreaking ceremony for the Shaheen Project at its Ulsan Refinery Plant in Ulju-gun, Ulsan-si, investing KRW 9.258 trillion, the largest investment in domestic petrochemical history.
The groundbreaking ceremony was attended by around 300 people, including South Korean President Yoon Seok-yeol, and Saudi Aramco CEO Amin Nasser, to celebrate the start of a new chapter in S-OIL's history.
The Shaheen Project is S-OIL's ambitious plan to solidify its position as an eco-friendly energy and chemical company that aims for broad carbon neutrality. The Shaheen project is located in the Onsan National Industrial Complex in Ulsan City and is scheduled to be completed in June 2026.
“When Crown Prince Mohammed bin Salman of Saudi Arabia visited Korea last November, we agreed to develop our bilateral relationship into a future-oriented strategic partnership," said President Yoon. ”We decided to promote large-scale economic cooperation projects together and signed an investment contract and an MOU.”
"I sincerely congratulate the start of the Shaheen Project, a representative achievement of Korea-Saudi economic cooperation today, and strongly support and support S-OIL and Ulsan City's new leap forward," he added.
Saudi Arabian Oil Company (Aramco) has made its largest-ever investment in South Korea through the development of the Shaheen petrochemical complex. The total investment, including the 4.8 trillion Won first phase completed in 2018, amounts to 14 trillion Won.
The project is being carried out in partnership with S-OIL, South Korea's third-largest oil refiner. The Shaheen petrochemical complex is expected to have a significant impact on the economy of Ulsan, as well as the country's wider manufacturing industry.
Hussain A. Al Qahtani, the CEO of S-OIL, said, "We are embarking on a great journey in the belief that this is the right time to invest in the future. Support from all of our stakeholders and our outstanding employees will no doubt deliver another major investment. Shaheen will not only expand the Company's business portfolio into petrochemicals but also advance our efforts to drive innovative growth across the entire value chain of our business."
During peak construction, the project is expected to generate as many as 17,000 jobs. After start-up, it will support more than 400 jobs and provide 3 trillion Won in added value to the economy.
The Shaheen petrochemical complex will significantly improve the stable supply of petrochemical feedstock and more than double ethylene production capacity in Ulsan. It will also supply monomer products through a pipeline to adjacent downstream olefin-processing businesses.
The Shaheen petrochemical complex will showcase cutting-edge technologies that support the reduction of greenhouse gas emissions. For example, its steam cracker will recycle waste heat for power generation in the refinery.
This industrial complex includes the world's largest steam cracker that produces ethylene, a basic petrochemical raw material (1.8 million tons per year based on ethylene production), TC2C facility with new technology that directly converts crude oil into petrochemical raw materials, and synthetic resin raw materials including plastics. It consists of related facilities such as polymer facilities and storage tanks that produce high value-added petrochemical products.
The use of 'TC2C' technology will help to reduce carbon emissions through a simplified and highly efficient conversion process. With the deployment of this new technology, which is being commercialized for the first time, crude and other low value heavy oils will be upgraded into steam cracker feedstocks.
Meanwhile, once the Shaheen Project is completed, the share of petrochemicals in S-OIL's business portfolio is expected to more than double from the current 12% to 25%.
