KOREA (SOUTH): Kuwait’s PIC acquires equity interest in Korea’s SK Advanced PDH project

Petrochemical Industries Co. (PIC), a wholly-owned Kuwait Petroleum Corp. (KPC) subsidiary, is acquiring a 25 % interest in SK Advanced Co. Ltd., which recently completed a 600,000-t/y propane dehydrogenation (PDH) plant in Ulsan, South Korea.

SK Advanced was established in 2014 as a joint venture between SK Gas Co. and the Advanced Global Investment Co. (AGIC) subsidiary of Saudi Arabia’s Advanced Petrochemical Co. The purpose of the venture was to build the PDH unit, on which construction had already been started by SK. AGIC held a 35 % equity interest in the project costing about USD 1-billion, while SK held the remaining 65 %. Following this transaction, SK will hold a 45 % stake in the venture and AGIC will hold 30 %.

Advanced Petrochemical, in a filing with Tadawul (Saudi stock exchange), said its board of directors believes that the participation of a “reputed partner like PIC confirms the viability, stability and growth” of the PDH business. It also noted “the experience and expertise” of PIC in the petrochemical sector will help to develop and promote further downstream businesses by the joint venture.

“Furthermore, this strategic partnership with KPC through PIC will also improve the competitiveness and stability of SK Advanced's PDH business, as a significant percentage of the feedstock will be supplied by KPC on a regular long-term basis,” the Saudi company added. Trial production of the PDH plant is expected to begin during this year’s first quarter.

Source: Weekly “PetroChemical News”, Durham, NC, USA; 25 Jan 2016
(Syed Rashid Ali, Karachi, Pakistan)