All participants at the unveiling ceremony for a huge stone with the engraving of the words of encouragement left by the late founder of Hyundai Group, Chung Ju-yung, held at Hyundai Oilbank’s Daesan Oil Refinery Complex in Daesan, South Chungcheong Province, in commmoration of the oil refinery’s 50th anniversary on June 30. President Kwon Oh-kap, 3rd L, claps hands along with other executives of the oil refinery and affiliates of Hyundai Motor Group. (Photo: Hyundai Oilbank)

Hyundai Oilbank, on the occasion of its 50th anniversary on June 30, declared its “Vision 2020,” aimed at boosting its annual sales to 50 trillion won and operating profit to 2 trillion won. A ceremony took place at the company’s Daesan Oil Refinery Complex in South Chung-cheong Province. A huge rock engraved with words of encouragement left by late founder of Hyundai Group, Chung Ju-yung, was unveiled during the most significant occasion for the company.

The oil refinery has another reason to celebrate its half-century anniversary: its first quarter earnings exceeded 100 billion won while its rivals suffered losses.

Hyundai Oilbank is the only oil refiner in Korea to turn a profit in Q1, but its new vision showed that its operation is geared to expand the non-oil refining sector of its operation to around 40 percent of the oil refinery’s total annual sales from the current 7 percent by 2020.

President Kwon Oh-kap said the company will focus its operation on lube oil production; oil storage; a joint venture with Lotte on the production of mixed xylenes, propylene derivatives production, and carbon black production; and investments in overseas energy businesses and other new businesses.

Propylene derivatives are raw materials for various kinds of plastics being used in autos and heat protection materials, and are made from refined oil wastes. Carbon black, a carbon powder, is used to make tires and paints and Hyundai Oilbank has been looking for a partner overseas to set up a joint venture plant to produce the material. 

The oil refinery has also been looking for opportunities to set up oil refineries and petrochemical plants in emerging countries with great growth potential. The new vision is designed to expand the oil refinery to the status of a global integrated energy company, expanding from its traditional business of oil refining. 

The oil refiner has concluded that its operation will be limited now that the oil refining market both at home and abroad has been saturated, thus is can no longer rely on oil refining as its main business focus.

The oil refiner’s business diversification moves are well-known over the past several years. The oil refinery set up a joint venture with Shell to produce the basic oil for lube oil in 2010 and entered the oil storage business the following year by building an oil storage complex in Ulsan New Harbor in Ulsan, North Gyeongsang Province. The oil refiner also set up Hyundai Chemical to form a joint venture with Lotte Chemical for the construction of an MX plant worth 1 trillion won and are now working on the design of the proposed plant.

President Kwon said the ultimate core of the company’s competitive strength is manpower, adding that there is no doubt that they will be able to achieve all of its objectives if all of the officers and staff unite behind the same goal, that is, be an integrated energy company in the global energy market.