SK Innovation, Japan firm to co-invest in petrochemical plants

SEOUL, Aug. 5 (Yonhap) -- South Korea's top refiner SK Innovation Co. said Friday its two subsidiaries and a Japanese firm will invest a total of 1.35 trillion won (US$1.26 billion) to build joint paraxylene and lubricant plants here to meet growing demand. SK Innovation said that SK Global Chemical Co., its petrochemical wing, and JX Nippon Oil & Energy Corp. will spend 1 trillion won to set up a 50-50 paraxylene plant in Ulsan, some 414 kilometers south of Seoul. Ground will be broken for the plant later this year for completion in 2014, it said, adding that the plant will have an annual capacity of 1 million tons of paraxylene, a material used as a feedstock for synthetic fibers. Each company will halve the production. The new plant will raise SK Global Chemical's annual production of paraxylene to 1.5 million tons, SK Innovation said in a statement. In addition, SK Lubricants Co., a lubricant affiliate, will sign a 350 billion won deal with the Japanese firm to build a plant in Ulsan with an annual production capacity of 260,000 barrels of lubricant oil, SK Innovation said. The new plant start operation in the second half of next year, it said. "The joint investment will help the two companies strengthen their position as the leaders in Asia's energy market," said SK innovation.