SK Ulsan CLX Turns 60, Invests 5 Trillion Won by 2027 to Accelerate Net Zero Goals

SK Innovation 60th Anniversary
Future Identity as an 'Eco-friendly Energy & Materials' Company
1.7 Trillion KRW for Recycling Cluster to Achieve Net Zero
3 Trillion KRW Investment in Ulsan CLX Facility Conversion and Expansion

Ulsan Nam-gu SK Ulsan Complex (CLX) panorama. Photo by SK Innovation

[Asia Economy Reporter Choi Seoyoon] SK Innovation announced on the 11th that SK Ulsan Complex (hereinafter Ulsan CLX), which has led South Korea's energy supply for 60 years, will undergo structural reform to lead the future energy market. The goal is to accelerate the achievement of Net Zero by investing approximately 5 trillion KRW by 2027.

Marking its 60th anniversary this year, SK Innovation started in 1964 as South Korea's first oil refinery and has supplied energy centered on petrochemicals. Last year, SK Innovation declared its leap to an 'eco-friendly energy & materials' company to lead the future energy market amid the energy transition caused by the climate crisis. According to the 'Carbon to Green' strategy, the company plans to become an eco-friendly energy supplier centered on green energy rather than carbon. In particular, SK Innovation stated that it will achieve Net Zero through substantial eco-friendly investments rather than simply selling off energy & petrochemical businesses.

SK Group Chairman Chey Tae-won also visited SK Ulsan CLX last March and said, "Energy will shift from oil-centered to decarbonization, that is, electricity, and Ulsan CLX, which has well established an oil-centered energy network, will continue to play the role of South Korea's energy heart," emphasizing, "Ulsan CLX has sufficient capabilities to produce decarbonization-based energy such as electricity, hydrogen, and ESS, and many opportunities will be created in the future."

Accordingly, SK Ulsan CLX has set a financial story to reduce carbon by 50% by 2030 and achieve Net Zero by 2050, promoting greening of production processes and products.

About 5 trillion KRW investment over the next five years... "Achieving Net Zero through eco-friendly investments"

The main investment areas for SK Ulsan CLX until 2027 are ▲building a circular economy (1.7 trillion KRW) and ▲expanding eco-friendly products through facility conversion and expansion (3 trillion KRW). Since there are currently no products to replace petroleum products as energy sources, the plan is to change facilities in the mid-to-long term and recycle the petrochemical products produced so far.

First, to build a circular economy, a 'waste plastic recycling cluster' will be established. SK Geocentric revealed last year a blueprint as the 'world's largest urban oil field company' that converts waste plastic back into oil. Accordingly, by the second half of 2025, a waste plastic recycling cluster will be built on a 215,000㎡ site within SK Ulsan CLX, with facilities capable of recycling about 250,000 tons of waste plastic annually. It will be the world's first site equipped with all three major chemical recycling technologies: high-purity polypropylene (PP) extraction, depolymerization, and pyrolysis processes. This facility will recycle polyethylene (PE), polypropylene (PP), PET, and composite materials.

Investment will also be made in facility conversion and new/expanded installations to gradually shift the business portfolio from carbon to green. First, SHE (Safety, Health, Environment) investments will be executed to transform SK Ulsan CLX into an eco-friendly workplace. Representative examples include the installation of volatile organic compounds (VOCs) treatment facilities and the establishment of an environmental management improvement master plan.

In the long term, investments will be made to prepare for changes in fuel demand structure due to the decarbonization trend. As energy transition progresses due to climate change, demand for land transport fuels such as gasoline and diesel is expected to decrease, while demand for sustainable aviation fuel (SAF) will increase. Accordingly, SK Ulsan CLX plans to consider converting petroleum product production processes to chemical product production processes and establishing new processes for eco-friendly aviation fuel production in preparation for the period when petroleum product demand sharply declines.

Additionally, SK Ulsan CLX plans to invest in CCS (Carbon Capture & Storage) projects and the expansion of the Nexlene plant. High-performance chemical products like Nexlene, independently developed by SK Geocentric, can significantly reduce plastic usage compared to general chemical products.

SK Geocentric Waste Plastic Recycling Cluster Factory Site. Photo by Seoyoon Choi sychoi@

Carbon reduction already showing results... Process efficiency improvements and acceleration of CCUS technology

SK Ulsan CLX's carbon reduction efforts are already becoming visible through immediately executable process efficiency improvements and switching to low-carbon fuels. In the mid-to-long term, it is also accelerating the development of technologies that directly reduce carbon.

SK Ulsan CLX has reduced cumulative carbon emissions by 144,000 tons by replacing the fuel of 9 out of 11 power boilers from bunker C, which has high carbon emissions, to LNG by last year. The remaining 2 boilers are scheduled to switch to LNG fuel by 2023. This is expected to further reduce carbon emissions by 40,000 tons annually.

Furthermore, by optimizing equipment and operations to improve energy efficiency, SK Ulsan CLX is reducing carbon emissions. To improve heat transfer efficiency in the Crude Distillation Unit (CDU), various energy efficiency enhancement measures are being pursued, such as injecting additives that remove contaminants accumulating on heat exchangers and pipes, and installing heat exchangers with good heat transfer efficiency and corrosion-resistant air preheaters.

The CCUS (Carbon Capture Utilization and Storage) project, which can substantially reduce carbon through carbon capture and storage, is also being concretized. CCUS is a technology that helps achieve Net Zero by directly removing carbon dioxide.

SK Energy has been capturing carbon at SK Ulsan CLX for the past 20 years and supplying it as raw material for liquid carbon dioxide. SK Innovation is also participating in domestic and international national projects related to CCS. In particular, since last year, it has been involved in a government project to develop a CCS demonstration model that captures carbon dioxide from hydrogen plants and stores it in the Donghae gas field, and plans to secure CCS demonstration project rights to be promoted as a national project in the future.

Yoo Jaeyoung, General Manager of Ulsan CLX, said, "To achieve Net Zero, we are reducing carbon emissions through eco-friendly process improvements and fuel switching, and continuously discovering new technologies related to carbon reduction," adding, "Based on the capabilities accumulated over 60 years of supplying energy to South Korea, we will leap forward as an eco-friendly materials and recycling leading plant based on decarbonized energy."

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