South Korean President Yoon and Aramco president and CEO Amin H Nasser, among others, during the groundbreaking ceremony for the Shaheen project. Credit: Saudi Arabian Oil Co.

S-OIL, an affiliate of Saudi Aramco, has broken ground on the $7bn Shaheen petrochemical project in Ulsan, South Korea.

The large-scale, refinery-integrated petrochemical steam cracker is being built at the Onsan Industrial Complex of Ulsan City.

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It will be equipped to convert crude oil into petrochemical feedstock.

Expected to be completed by 2026, the project will produce up to 3.2 million tonnes of petrochemicals per annum.

The Shaheen project will feature a steam cracker with a production capacity of 1,800 kilo tons per annum (KTA) of ethylene and a TC2C facility to convert crude oil directly into petrochemical feedstock.

It will also feature a polymer facility to produce high value petrochemical feedstock, and other facilities such as storage tanks.

In a press statement, S-OIL said: “After completion of the project, S-OIL’s petrochemical production will more than double to 25% from the current 12% of total production, playing a pivotal role in diversifying its fuel-weighted business.”

The project is expected to create approximately 17,000 jobs during the construction phase and more than 400 jobs once operational.

Aramco president and CEO Amin H Nasser said: “Shaheen is among Aramco’s biggest international downstream investments, representing a significant and sizeable step forward in our liquids-to-chemicals expansion and another major milestone in further strengthening our presence in Korea.”

Aramco said that the investment in South Korea forms part of efforts to maximise the crude to the chemicals value chain.

Through its Aramco Overseas Company BV subsidiary, Aramco holds a more than 63% stake in S-OIL.