Korean engineering and construction major Hyundai E&C has broken ground on Saudi oil giant Aramco's mega petrochemical project in South Korea being set up at an investment of $7 billion.
To be located in Ulsan city, the Shaheen Project will convert crude oil into 3.2 million tonnes per annum of petrochemical feedstock.
The key Aramco facility will feature a steam cracker with a production capacity of 1,800KTA of ethylene, a TC2C facility for converting crude directly into petrochemical feedstock, a polymer facility, and other facilities such as storage tanks, said the statement from Hyundai E&C.
The groundbreaking ceremony was attended by South Korean President Yoon and Aramco President and CEO Amin Nasser as well as other senior officials from both countries.
Announced in November last year, the Shaheen petrochemical project is said to be an important part of the regional crude to chemicals strategy of Aramco.
Shaheen is a vital project for the South East Asian country, in which S-Oil has made significant investment of 9.26 trillion won to boost its value-added petrochemical production facilities.
Speaking at the ground breaking ceremony, Nasser said: "Shaheen is among Aramco’s biggest international downstream investments, representing a significant and sizeable step forward in our liquids-to-chemicals expansion and another major milestone in further strengthening our presence in Korea."
Aramco holds a majority stake of over 63% in S-OIL through its subsidiary Aramco Overseas. Through this mega Korean investment, Aramco is eyeing high value-added petrochemical products such as polyethylene (PE).
The Shaheen petrochemical project will feature a steam cracker with a production capacity of 1,800 kilotons per annum (KTA) of ethylene.
As per the agreement, Hyundai E&C is the project lead and will work along with its key subsidiary Hyundai Engineering (Hyundai ENG), Lotte E&C, and DL E&C on the construction.
To be divided into three packages; Hyundai E&C will carry out Package 1 with Hyundai ENG, DL E&C to build steam cracker and TC2C facilities, while Package 2 involving the installation of HDPE (high-density polyethylene), LLDPE (linear low-density polyethylene) production facilities and automated warehouses will be led by Hyundai ENG and Lotte E&C, and Package 3 for tank construction by Lotte E&C. The project is scheduled for completion in 2026.
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