울산산단 사업재편 변수 된 에쓰오일 9조원대 신규 설비…“각사 이해관계 달라”

South Korea's oil and chemical industry is facing pressure to reduce investments from China's supply and revenue issues, and a 9 trillion won new petrochemical facility under construction by ETSOIL in Ulsan's business restructuring is a key variable. The structural adjustment discussions centered around cutting existing naphtha crackers (NCC) and the simultaneous launch of the giant new facility highlight the complexity of government and industry strategies to maintain competitiveness.

The company emphasizes that the new facility will provide a cost-competitive production base with energy efficiency, flexibility in raw material utilization, and contributes to strengthening the domestic petrochemical industry's global competitiveness. ETSOIL is investing 9,258 billion won in the Shincheon project at Ulsan's National Industrial Complex, with commercial operations expected to start next year.

The key technology behind the project is the crude oil-to-chemicals (COTC) technology, which allows the conversion of crude oil and naphtha residues into petrochemical feedstocks. ETSOIL claims that the project will increase the proportion of petrochemical feedstock in the feedstock ratio from 15-18% in conventional distillation processes to 65-70%.

This will lower the raw material burden compared to naphtha-centered facilities. However, the Shincheon project adds uncertainty to the Ulsan petrochemical restructuring, as the government and industry agreed in August last year to reduce the production capacity of the domestic three petrochemical complexes (Daesan, Yeosu, and Ulsan) to a maximum of 3.7 million tons of ethylene per year.

As other competitors reduce related facilities, ETSOIL is preparing to increase its production capacity. The Ulsan petrochemical restructuring discussions are expected to continue in the near term, aligned with the preparation status of the Shincheon project. While the government has approved separate petrochemical restructuring projects in Daesan and Yeosu, the Ulsan discussions are more complex due to the combination of the shutdown of existing facilities and the launch of the Shincheon project.

ETSOIL also acknowledged in its earnings briefing on the 18th that "the structure adjustment plan is still somewhat delayed" and that "the high cost of facilities in the Shincheon project gives it a competitive advantage, leading to diverse interests among stakeholders."