SK Innovation’s trading unit to raise oil blending capacity
A TRADING unit of SK Innovation, which owns the country’s largest refiner SK Energy, will quadruple its offshore low-sulphur fuel supply next year to meet the growing demand for diesel fuel with substantially lowered sulphur content under toughening emission control regulations, the company said on Monday.
SK Trading International plans to increase its oil blending capacity from 23,000 barrels per day to 90,000 barrels next year, aiming to become the number one provider of low-sulphur fuel in Asia.
The plan will be supported by SK Energy’s vacuum residue desulfurisation facility which starts full operations in April. Its supply of lowsulphur fuel can go up to 130,000 barrels per day, the company said.
SK Energy and SK Trading International are both subsidiary of SK Innovation.
The trading unit started the oil blending business in 2010, delivering low-sulphur fuel onboard a tanker after processing half-finished products.
The business satisfies regulatory measures by the International Maritime Organisation (IMO) to be implemented next year.
IMO has obligated ships to lower the portion of sulphur in marine fuels from 3.5 per cent to 0.5 per cent. By lowering it, the quantity of sulphur oxide emission will be slashed by 86 percent, according to the global agency.
SK Trading’s target of providing 50 million barrels of low-sulphur fuel starting next year will reduce sulphur oxide emissions by 100,000 tonnes per year, equivalent to sulphuric gas emitted from 200 very large crude carriers per year, the company said.
In line with toughening regulations, SK Trading expects to see a significant growth in demand for low-sulphur fuel oil and marine gas oil next year.
Citing Internationa l Energ y Agency data, it said the demand for low-sulphur is expected to increase from 100,000 barrels to one million barrels per day.