GS Caltex opens cracking facility sourced on less volatile materials

MFC [Provided by GS Caltex]

GS Caltex has completed the construction of a large olefin cracking facility, enabling the South Korean oil refining major to achieve business diversification and growth potential into less volatile non-refinery business.

A ribbon-cutting ceremony was held on Friday at the company’s new mixed feed cracker (MFC) site in Yeosu on the country’s southwest coast, where Hur Sae-hong, CEO of GS Caltex, and Kim Young-rok, Governor of Jeollanam-do attended among others.

The company has invested 2.7 trillion won ($2.03 billion) in the MFC project since 2018. The MFC site is capable of producing 750,000 tons of ethylene, 500,000 tons of polyethylene and 410,000 tons of propylene, 240,000 tons of mixed c4 fraction and 410,000 tons of pyrolysis gasoline per year.

The MFC can use not only naphtha but also other various raw materials like liquefied natural gas and other by-product gases from the refinery process.

The site has five heating furnaces with an annual capacity of 150,000 tons each, the largest in Korea. The furnace is essential for pyrolysis of raw materials at a high temperature of 850°C to convert them to olefins, a primary petrochemical used as feedstock for a wide range of industrial materials, including plastics.

GS Caltex already entered the high-density polyethylene (HDPE) market to ensure stable processing of ethylene, a key product from the MFC. An HDPE process in conjunction with the MFC was also installed with an annual scale of 500,000 tons

GS Caltex expects to reduce earnings volatility caused by external environmental changes such as oil prices by accelerating the transition to the non-refining business structure through the MFC.