Crown prince of Saudi Arabia Mohammad bin Salman bin Abdulaziz Al Saud.

New CEO Hussain A. Al-Qahtani of S-Oil. (Photos: S-Oil)

S-Oil Corp. is scheduled to hold a dedication ceremony for its new petrochemical plant built in Onsan, N. Gyeongsang Province, on June 26, with Saudi Aramco being a majority shareholder in the oil refiner, ranked the third largest in Korea.

Crown Prince Mohammad bin Salman of Saudi Arabia is expected to attend the ceremony, industry sources said on June 7. The crown prince is also the deputy prime minister of Saudi Arabia and is scheduled to attend the G-20 Meeting in Osaka, Japan, slated to open from June 28-29.

The sources said the Saudi oil refiner issued invitation cards to the dedication event to dedicate the mixed feed cracker and olefin downstream facilities that it built in Onsan, Korea, next to its oil refining complex at the cost of 4.9 trillion won.

The invitation only said the date will be June 26 at the Dynasty Room of Silla Hotel in Seoul, but did not record the exact hours for the event, with a note that it will send further invitation cards in the middle of June.

Business sources said the exact hours of the event have been left out as the visit of Crown Prince bin Salman to the Seoul event had not yet been certain. They expect the Crown Prince to come to Seoul for the event because he is sure to lead the Saudi government delegation to the Osaka event as Saudi Arabia is the next chair country for the G-20 Meeting in 2020.

The Crown Prince usually includes a number of economic specialists among the delegations he leads to international meetings, and the delegation he brings to Korea will be no exception.

The Korean business community expects serious economic development projects may be taken up and agreed upon during the visit with the Korean government. Crown Prince bin Salman has been at the center of the Arabic government’s Vision 2030 Economic Development Plan requiring some $700 billion or 824 trillion won to fulfill the mammoth project.

S-Oil Corp., South Korea’s third-largest refiner wholly owned by Saudi Aramco, is prepping for another large-scale petrochemical venture in Korea that is expected to cost more than 5 trillion won ($4.47 billion) through 2023.

The refiner said it is conducting a feasibility study for building a mixed feed cracker with an annual capacity of 1.5 million tons and olefin downstream facilities. It has already secured land for the project, having bought a 400,000 square-meter site near its Onsan factory in the southeastern city of Ulsan from Hyundai Heavy Industries.

This will be the second-phase investment after its 4.8 trillion won project involving a residue upgrading complex and olefin downstream complex that was completed this year.

A steam cracker is a petrochemical plant that turns naphtha and light hydrocarbons into ethylene, propylene and other chemical raw materials. This process is considered more economically efficient as it cuts out the expensive distillation processes and produces a wider range of products.

With the new olefin downstream facilities, S-Oil plans to produce more value-added petrochemical products such as polyethylene and polypropylene.

The company estimates the project to create 2.7 million jobs per year during the construction period and 400 permanent jobs.

“Once completed, the new facilities would allow us to better respond to rapid business changes regarding shale oil and electric vehicles,” said an official at S-Oil. Industry analysts said S-Oil’s heavy investments in recent years underscore its determination to cement its global leadership in aromatics and olefins.

Vision 2030 is built around three primary themes: a vibrant society, a thriving economy and an ambitious nation.

A view of S-Oil's new petrochemicfal plant dedicated recently in Onsan, North Gyeongsang Province.