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(Reuters) -- Japan's JX Nippon Oil
& Energy Corp will join forces in petrochemicals and lubricating oils with
SK Innovation Co of South Korea, the Nikkei business daily reported.
Faced with flagging demand for gasoline and other petroleum products in
their respective home markets, the two giants will invest around 120 billion yen
(USD 1.52 billion) in a pair of new production ventures in South Korea, the
paper said.
A formal agreement on the business partnership is expected as early as
Friday. The new petrochemicals and lubricants factories will be built on the
grounds of the South Korean group's refinery complex in the southeastern city of
Ulsan. JX Energy will invest more than 50 billion yen in the two ventures, the
Nikkei said.
In petrochemicals, the JX Holdings Inc unit will form a 50-50 venture
with SK Global Chemical Co, a unit of SK Innovation. Production of paraxylene,
an oil-based raw material for synthetic fibers and plastics, is expected to
begin around 2014, the business daily said.
At an investment of some 90 billion yen, the new facility will have an
annual output capacity of about 1 million tons, making it one of the biggest in
the world, the daily reported.
This will bring JX Energy's total paraxylene capacity, now at 2.62
million tons a year, to about 3.1 million tons and raise its share of the Asian
market to around 15 percent, cementing its position as the top producer in the
region, the paper reported.
mrcplast.com
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