S-Oil’s Shaheen Project targets 3.2 million tons at commercial launch

At S-Oil’s Onsan complex in Ulsan, South Korea, a 9 trillion won ($6.4 billion) bet is taking shape: a plant designed to turn crude oil directly into the chemical building blocks used by plastics and resin makers. The Shaheen Project is slated for commercial production next year, with annual output projected at up to 3.2 million tons.

The technology changes the route through the refinery. Instead of treating crude oil mainly as a source of fuels before making chemicals from selected fractions, thermal crude to chemicals technology sends crude and low-value refinery fractions directly toward petrochemical feedstocks. S-Oil says the facility will combine a high-efficiency steam cracker, power generation, waste-heat recovery and advanced process optimization.

That integration is also where the project’s environmental claim sits. S-Oil says the design has reduced carbon emissions by over 20 percent compared with its original layout, while improving raw-material and energy use. The company also says the plant can work with a flexible mix of feedstocks, a useful buffer when prices move or supplies are disrupted.

So what changes in practice? Ethylene, propylene and other basic chemicals will move through dedicated pipelines to downstream manufacturers in the Ulsan complex. Those companies will have access to local raw materials at lower, more predictable prices, according to S-Oil, which could make finished plastics and resins more competitive and reduce reliance on imports.

The project is meant to do more than add capacity. S-Oil says it aims to double the share of petrochemicals in its output, as Korean producers face cost pressure, global oversupply and aggressive expansion of crude-to-chemicals projects in China and the Middle East. The facility is still awaiting commercial operation, so its promised capacity and efficiency will have to be tested in stable production.