- Corporate News
MOL Group to take advantage of growing demand for jet fuel, lubricants and base oils
As part of its long-term strategy, Hungary’s MOL Group plans to gradually increase the share of high-value non‐motor fuel products to above 50% by 2030, from below 30% today. MOL Group, an integrated, international oil and gas company, headquartered in Budapest, Hungary, is active in more than 30 countries.
MOL Group said it intends to increase the feedstock for its petrochemical plants, while also taking advantage of the growing demand for such profitable products as jet fuel, lubricants and base oils. MOL will also expand its market share in LPG.
MOL Group plans to invest around USD80‐130 million into its refineries in Hungary and Slovakia to increase the flexibility of propylene and lubricants production.
In order to process the most profitable crude oil and to match the demand for its products, MOL Group said it intends to increase the seaborne crude intake to its landlocked refineries from the current 10% to 33% by 2030, while also increasing the crude basket to above 50 grades.
MOL has earmarked up to USD1.9 billion until 2021 to develop its petrochemicals business. The yield improvement of propylene and investment in attractive propylene derivatives will be the main direction of the MOL Group for the next five years, the company said. In order to allow further diversification in the propylene value chain, MOL Group will invest more than USD500 million into its steam crackers in Hungary and Slovakia. MOL Group will also invest in propylene oxide-based polyols.
MOL Group Chairman and CEO Zsolt Hernádi said that “Relying on our integrated business model’s strong cash flow generation and our robust balance sheet, we will invest substantial funds into strategic investments to further diversify our business and increase our exposure in areas that are not dependent on the demand for motor-fuels. As a result of our industrial transformation, the first phase strategic projects in petrochemicals are expected to contribute USD 250-300mn annually to our EBITDA, while the weight of customer services is expected to exceed 20% of our total EBITDA by 2021. At the same time our strong cash flows will also be able to comfortably maintain the rising trend in dividends for our shareholders.”