Base oil refiners GS Caltex and Hyundai Shell Base Oil both posted increases in operating profit and drops in sales for the first quarter, compared to results in 2019’s second quarter.
South Korea-based GS Caltex’s lube division reported operating profit of 55.3 billion won (U.S. $46.8 million) in the second quarter, up 67%from ₩33.2 billion in 2019’s second quarter.
Sales declined 20% to ₩265.1 billion in the quarter, down from ₩330.1 billion.
The 50-50 joint venture of GS and Chevron has capacity to produce 26,000 barrels per day of API Group II and Group III base oil at its plant in Yeosu and 9,000 b/d of finished lubricants at its blending plant in Incheon.
Hyundai Shell Base Oil
Joint venture Hyundai Shell Base Oil posted operating profit for its lube base oil segment of ₩20.2 billion in the second quarter, up 349%from ₩4.5 billion in 2019’s first quarter.
Sales declined to ₩123.7 billion, down 44%from ₩221.2 billion.
Hyundai Oilbank said in its earnings presentation that the feedstock to base oil price spread was much higher in the second quarter compared to a year earlier due to fluctuations in crude oil prices. The spread in the second quarter for its API Group II 150 neutral oil was $134 per metric ton, up 113% from last year’s second quarter. The spread for its Group II 500 neutral base oil was $248/t in the quarter, 210% higher than in the year-earlier period.
The 60-40 joint venture between Hyundai Oilbank and Shell has a base oil plant in Daesan, South Korea, with capacity to produce 25,000 b/d of Group II base oil.