A Top Honor for S-Oil CEO
President Al-Subaey presented with an order for making oil products a major export category for Korea
President A. A. Al-Subaey of S-Oil won the Order of Industrial Merit, Gold Tower, for his role in turning petroleum products into a major export item for Korea during the ceremony for the 48th Trade Day held on Dec. 12 at COEX in southern Seoul.
The citation for his achievement as the top executive of the oil company said refiners have done their part to make oil products a major export item from Korea during the past several decades and S-Oil played a key role.
The oil refineries in Korea have done their best to expand exports of oil products, with the volume growing large enough to make it the nation's third largest export item, thus making a large contribution to the nation's expanding trade surplus.
The citation noted that S-Oil was a latecomer in the oil refining industry in Korea, exporting its oil products overseas from the beginning, rather than selling it on the domestic market. In the 1980s, when S-Oil was launched, the domestic oil refiners focused on supplying their products to domestic consumers first and then exported the leftover oil products overseas.
But from the mid-1980s, S-Oil looked at the overseas oil market as its major market and conducted aggressive marketing efforts to export its oil products, and by the start of the 1990s, the oil refiner accounted for more than 40 percent of total oil products exported from Korea, leading the domestic oil refiners in overseas exports.
The oil refiner has continued to push exports of its products to the extent that in the 2000s, its exports accounted for more than half of the oil refined at its refineries in Korea and the volume rose to over 60 percent in the middle of the 2000s as the oil refiner introduced strategic target marketing to generate high value-added profit. S-Oil has become a locomotive leading the domestic oil refining industry to export more than 60 percent of its oil products overseas.
In the meantime, on Oct. 20, S-Oil dedicated its new paraxylene plant, capable of producing 1.7 million tons of the petrochemical product and 560,000 tons of benzene, at its oil refinery complex in Onsan with a slew of dignitaries and other participants present at the ceremony led by President Lee Myung-bak.
Also present at the dedication of the world's largest such plant were Saudi Oil and Mineral Resources Minister Ali al-Naimi, Aramco Chairman Khalid al-Falih, and other foreign and domestic attendants totaling some 1,000.
Aramco is the largest stakeholder in S-Oil followed by Korean Airlines as the second largest stakeholder. Chairman Cho Yang-ho of the airline attended the event.
President Al-Subaey said the company projects earnings of more than $2 billion annually from the sale of paraxylene from the new plant including exports. He went on to say at the ceremony that Asia's demand for paraxylene takes up 79 percent of total world demand and the oil refinery is projected to earn some 20 percent in profits from the sale of the product.
S-Oil's board decided to build the new plant in 2007 with all of its members attending including President Samir Tubaeyeb and Chairman Cho Yang-ho of Korean Airlines. The board agreed to invest 1.3 trillion won in the new paraxylene plant by expanding its Onsan refinery complex in Onsan, South Gyeongsang Province. The needed funds amounted to about half of the company's capital and the project was completed four years later.
President Lee attended the ceremony because of his personnel connection with the oil company from when he was CEO of Hyundai Construction, which built Ssangyong Oil, the predecessor of S-Oil, in 1976. Another reason for attending is Korea's relations with the Middle East, with Aramco of Saudi Arabia, one of the world's largest crude oil producers, the major stakeholder of S-Oil. In recent years Korean firms have been working to secure more construction projects in the region. nw
President A.A. AL-Subaey of S-Oil shakes hands with President Lee Myung-bak after receiving the Order of Industrial Merit, Gold Tower for S-Oil's outstanding contribution to the nation's exports.
Photo on courtesy of KITA