SK, Repsol JV to Make Group III


SEOUL – SK Lubricants will partner with Repsol YPF to build a new 13,300 barrels-per-day API Group III base oil plant in Spain.

SK Lubricants CEO Bong Kyoon Park announced the joint venture here yesterday at the ICIS Asian Base Oils & Lubricants Conference. SK is listening to the industry and expanding capacity, said Park.

The new base oil plant will be built at Repsols Cartagena, Spain, refinery and is scheduled to begin production of Groups II and III base oils in 2013. A new clean fuels refinery, 100 percent owned by Repsol, will provide the hydrocracked feedstock for the base oil plant.

SK and Repsol have not yet finalized their agreements, Park told Lube Report, but SK will have a controlling 60 to 70 percent share of the venture, while Repsols share will be 30 to 40 percent. As with its joint venture in Indonesia with Pertamina, SK will supply the technology and marketing, while Repsol will supply feedstocks, land and utilities.

The jv agreement should be completed by the end of this month, Park said.

SK, headquartered in Seoul, Korea, with two base oil plants in Ulsan, currently ships products worldwide from its Asian refineries. The new Spanish plant, said Park, will reduce delivery and operating costs. Producing in Europe gives a strong competitive advantage and access to European customers.

SK confirmed plans to announce a fifth base oil plant with capacity over 10,000 b/d within the next two months. A possible location would be Asia, said Jay Kim, SK senior manager for base oil marketing.

SKs Korean plants have total Group II capacity of 4,000 b/d and 17,000 b/d of Group III capacity. Its Dumai, Indonesia, jv with Pertamina has 7,000 b/d of Group III capacity. Repsol, based in Madrid, has two base oil refineries: a 2,200 b/d Group I plant in Puertollano, Spain, and a 2,650 b/d plant, primarily Group I, in Cartagena.

Related Topics

Market Topics