SK E&S "Corporate Value 5x Increase with New Energy"

Portfolio Shift to Hydrogen and Renewables
Targeting 13 Trillion KRW Revenue Growth by 2025

[Asia Economy Reporter Choi Dae-yeol] SK E&S, which focuses on city gas and power generation businesses, has decided to shift its portfolio primarily to new businesses based on next-generation resources such as hydrogen and renewable energy. The company plans to completely restructure its business model to grow into a next-generation energy company with sales of 13 trillion KRW and a corporate value of 35 trillion KRW by 2025. As the oil-based carbon society fades and competition for dominance in the future energy industry intensifies, leading multiple eco-friendly energy businesses simultaneously is rare not only in Korea but also worldwide.

At the media day held on the 1st, SK E&S CEO Choo Hyung-wook said, "We will build a differentiated ‘green portfolio’ in four core business areas?hydrogen, renewable energy, energy solutions, and eco-friendly liquefied natural gas (LNG)?to lead the future global energy ecosystem."

The company is a holding company with subsidiaries engaged in city gas and power businesses, and it is also leading SK Group’s recently emphasized hydrogen business at the forefront alongside renewable energy such as solar power. CEO Choo also serves as the head of the hydrogen business promotion team, which includes major SK affiliates. Utilizing existing LNG business infrastructure and integrated capabilities across the value chain of production, distribution, and sales, the company unveiled a vision to become the world’s number one hydrogen business operator. By 2025, it plans to establish an annual production capacity of 280,000 tons of hydrogen, including 30,000 tons of liquefied hydrogen and 250,000 tons of blue hydrogen. Considering that the company currently producing the most hydrogen domestically produces less than 70,000 tons annually, this is a significant volume.

In the renewable energy sector, SK E&S plans to expand its power generation business, including solar power, and develop into a renewable energy investment specialist company covering domestic and international emission rights. Currently, the company is developing and operating renewable energy projects totaling 2.5 GW domestically, including the Saemangeum floating solar project, and aims to increase this to 7 GW by 2025 while securing 1.2 million tons of carbon emission rights.

In the promising energy solutions sector, the company announced plans to acquire a major U.S. company in the near future. Energy solutions refer to the comprehensive concept covering everything from planning and financing for power plant construction to construction, operation, maintenance, and aftercare.

Additionally, the LNG business will be transformed into an environmentally friendly operation by applying carbon capture and storage (CCS) technology. Since conventional LNG business inevitably produces carbon dioxide, the company intends to achieve carbon neutrality through CCS technology. The company stated that the Barossa-Caldita gas field project in Australia will be the first project to apply this method.

While many companies pursue hydrogen, renewable energy, or LNG with CCS technology individually as future energy sources, SK E&S is the first in Korea to announce a plan to lead with such a diversified business model. There is no major overseas energy company with this approach either.

Through these four core businesses, SK E&S aims to increase its current corporate value of about 7 trillion KRW to 15 trillion KRW the year after next and 35 trillion KRW by 2025. Sales are targeted to grow from 6 trillion KRW last year to 13 trillion KRW in 2025, and EBITDA is expected to increase from 700 billion KRW to 2.8 trillion KRW during the same period. CEO Choo said, "We will do our best to become a ‘global major eco-friendly energy company’ preparing for the energy transition era."

This content was produced with the assistance of AI translation services.