All four oil refineries in Korea had their operating profits surpassed 1 trillion won level last year with Hyundai Oilbank seeing its operation profit exceed over 1 trillion won thanks to its petrochemical sector which did very well leading the oil refiner’s overall operation.
SK Innovation which had its operating profit jump over 1 trillion won posting the best record last year with the help from its petrochemical sector operation.
Hyundai Oilbank had its operational record for 2017 approved officially at the board meeting on Feb. 1. Its sales revenue amounted to 16.376, 2 trillion won, up 37.8 percent YoY with its operating profit standing at 1.260,5 trillion won up 30.5 percent YoY, exceeding the estimates.
KB Securities, Korea Investment and Securities and Eugene Investment and Securities estimated that Hyundai Oilbank would log from 1.136 trillion won to 1.210 trillion won in operating profit for 2017. The oil refinery’s outstanding performance opened the age of the 1 trillion won in operating profit for all four oil refineries in Korea.
The excellent results in the non-oil sector was what put the oil refinery over the challenging operational record for 2017 to catch up with other rival oil refineries. SK Innovation, GS Caltex, and S-Oil, already had their operating profits exceeding 1 trillion won in the 2000s.
Hyundai Oilbank’s non-oil sector had its operating profit amounting to 299.5 billion won in the first three quarters of the year last year, up 259.5 percent YoY.
A notable help for boosting the oil refinery’s record came from Hyundai Chemical, a 60-40 joint-venture with Lotte Chemical to produce xylene which went online last year at a surprising record. The superb operation of the chemical plant helped to raise the non-oil sector’s profit share of the oil refinery to 32 percent from around 20 percent last year.
SK Innovation also had a big help from its non-oil sector in boosting its overall profit over the 3 trillion won level in the past couple of years. The oil refining margin remained about the same last year, but those for ethylene, paraxylene and benzene were very remarkable to raise their profit margins.
S-Oil had its non-oil sector make a huge advance in profit with its share of profit in its overall operation rising to 52.6 percent, while its sales share extended to 21.4 percent of all the oil refinery’s annual sales last year. GS Caltex was said to have its operating profit last year coming to around 2 trillion won level, the average levels in the past several years, although no official numbers were given as yet.
South Korea relies on imports to meet about 98% of its fossil fuel consumption as a result of insufficient domestic resources. The country is one of the world’s leading energy importers. South Korea was the world’s ninth-largest energy consumer in 2015, according to estimates from the BP Statistical Review of World Energy 2016. 1 Because South Korea lacks domestic energy reserves, it is one of the top energy importers in the world and relies on imports for about 98% of its fossil fuel consumption.
South Korea ranks among the world’s top five importers of liquefied natural gas, coal, crude oil, and refined products.2 South Korea has no international oil or natural gas pipelines and relies exclusively on tanker shipments of LNG and crude oil. Despite its lack of domestic energy resources, South Korea is home to some of the largest and most advanced oil refineries in the world. In an effort to improve the nation’s energy security, oil and natural gas companies are aggressively seeking overseas exploration and production opportunities.
Hyundai Oilbank and GS Caltex are said to be considering large investments in their naphtha cracking centers, a key facility for petrochemical plant facilities to show that the moves on the part of the oil refineries in Korea to boost their profits through the petrochemical sector of their operations would continue to pushed.