[Sponsored Report] SK shares innovation with foreign companies

Officials from BSR, SK Energy, J Con, UBEC and Daechang Machinery and Engineering pose for a photo at the BSR refinery regular maintenance company selection ceremony.

Binh Son Refining & Petrochemical Co. Ltd., or BSR, is a Vietnamese company that built the first oil refinery factory in Vietnam. They have chosen SK Energy subcontractors J Con, UBEC and Daechang Machinery and Engineering to conduct their first maintenance check up. The check up is worth $15 million.

SK Energy is sharing the factory operation responsibilities and their in-depth know-how, along with the technology expertise, with the Dung Quat Oil Refinery in Vietnam. SK Energy recommended its three subcontractors since they have been in control of regular maintenance for SK Energy’s facilities for 40 years. These three subcontractors have been highly evaluated for their maintenance knowledge that has been acquired over the last four decades.

This service contract is the first case where Korean oil refinery’s subcontractors have won a large-scale maintenance job elsewhere in the world. It proves that the technology of Korea’s small- and medium-size companies is widely believed to be of the highest quality and it provides a win-win opportunity for SK energy and its subcontractors.

According to this contract SK Energy and its three subcontractors will be in charge of the factory maintenance and repair from July and September. The companies plan to pass down the preparation, maintenance and repair knowledge it has accumulated over the past 40 years.

In March this year SK Innovation supported JX Nippon Oil & Energy, the largest energy company in Japan, which suffered from the earthquake and tsunami. SK Innovation CEO and president Koo Ja-young visited Japan’s JX Nippon Oil & Energy headquarters in March and delivered his condolences and discussed how the two companies could cooperate with each other.

SK Innovation agreed to buy 2 million barrels of Middle East crude oil (worth $200 million) from JX Nippon Oil & Energy as the oil was a burden for them. SK Innovation also agreed to review the possibility of purchasing additional crude oil. Moreover, as Japan is restricting the amount citizens can buy at gas stations and is suffering from lack of supply, SK Innovation supplied 260,000 barrels of gasoline to JX, which is about a quarter of the country’s daily consumption.

Moreover, Cha Hwa-youp, president and CEO of SK Global Chemical, held a meeting with the CEOs of its SK companies and the CEOs of subcontractors at SK Seorin building on June 3 to discuss the win-win strategy and the establishment of more partnerships.

Through this meeting the SK Global Chemical kicked off the win-win development committee and agreed to increase technology support, financial support and management support in order to reinforce competitiveness. Also through raising the SK Global Chemical win-win development fund to 30 billion won, subcontractors will benefit financially.

Cha Hwa-youp, president and CEO of SK Global Chemical, said “In the long-term the partnership between subcontractors and SK Global Chemical is very important. I hope this meeting will become a stepping stone as a communication era where we can establish a long-term relationship based on bond of sympathy between each other.”

By Lee Ji-hyun [concordia@joongang.co.kr]