S-OIL to collaborate with Saudi Aramco on low carbon energy R&D
South Korean oil refiner S-OIL has signed four MOUs with Saudi Aramco to collaborate in the alternative energy business, including Thermal Crude to Chemicals (TC2C) technology, research and development (R&D) on the production of lower carbon future energy, and investment in venture capital.
Saudi Aramco became the single largest shareholder of S-OIL in January 2015, following its acquisition of Hanjin Group’s stake in S-OIL.
The two companies signed the memoranda of understanding during the ‘Saudi Arabia-Korea Investment Forum for Smart Innovation & Growth’ held in Riyadh, the capital city of Saudi Arabia.
Moving forward, S-OIL and Saudi Aramco are set to actively explore potential cooperation in building infrastructure to store, supply, and utilize competitive blue hydrogen and blue ammonia after bringing them into South Korea. The cooperation includes R&D on the import and supply of blue hydrogen and ammonia.
Moreover, both companies aim to pursue the production of hydrogen, the development of new carbon capture technology, plastic recycling technology as well as research on carbon neutral e-Fuel. Areas of cooperation include the potential joint investments into domestic venture companies specialized in new energy technology or decarbonization.
“We articulated an ESG Roadmap and Green Initiative, to make sure our ESG practices not only serve the company well but also all our stakeholders and communities at large,” said Hussain A. Al-Qahtani, CEO of S-OIL, in his New Year speech.
Last year, the company bought a 20% stake in fuel cell venture company FCI to make inroads into the hydrogen business. Additionally, it participated in the clean hydrogen project consortium with Samsung C&T and Korea Southern Power Co., Ltd (KOSPO) to accelerate its hydrogen business in full swing.
Moreover, S-OIL works on various fronts to secure a sizable amount of demand by switching into hydrogen fuel for its plant and putting hydrogen in the process of middle distillate cracking and desulfurization.
The MOUs also aim at enhancing the competitiveness of the company’s key business areas such as oil refining, petrochemical and lube base oil production. S-OIL is planning to apply TC2C, which is being developed and will be commercialized by Saudi Aramco for the first time, during phase 2 of its Shaheen petrochemical project. Saudi Aramco agreed to proactively collaborate for the successful completion of the project by providing its expertise in R&D of the olefin downstream process and petrochemical product. Final Investment Decision (FID) of the Shaheen project is expected this year, after completion of the Front End Engineering Design (FEED).
If successfully completed, S-OIL will gain momentum to further pursue its growth strategies in the energy transition era by expanding beyond its vision of Oil to Chemicals.