GS Caltex converts Yeosu refinery to use liquid gas

GS Caltex has converted a production facility at its Yeosu oil refinery plant in South Jeolla to run on liquefied natural gas instead of low-sulfur fuel oil, the company announced Thursday.

The company said the transition will help it reduce its carbon dioxide emissions by more than 19 percent, allowing it save up to 11.5 billion won ($9.4 million) per year previously spent on reducing greenhouse gas emissions from the plant.

Using low-sulfur fuel oil produces 76 tons of carbon dioxide per terajoule, while natural gas emits 56 tons, 74 percent of the more carbon-intensive oil.

The company declined to specify the cost of updating the facility.

GS Caltex is Korea’s second-largest oil refiner, after SK Energy.

Emissions of substances like sulfur oxides and nitrogen oxide - which help to drive fine particulate levels - will also plummet by more than 30 percent, GS said.

The switch will free up low-sulfur fuel oil produced at the refinery as a revenue source for the company. Demand for the product has increased after the International Maritime Organization restricted the maximum sulfur content in marine fuel oil to 0.5 percent from the previous 3.5 percent.

GS Caltex’s CEO Hur Sae-hong has said he wants the company to move more quickly toward an environmentally friendly business model since taking his position last year.

“Energy demand is on a constant rise, but the traditional supply-centered ways are not enough to tackle the issue of greenhouse gas emissions,” Hur said in a statement released by GS on Thursday. “Boosting energy efficiency can fulfill the contradictory goals of stabilizing energy supplies and coping with climate change.”

During his inauguration ceremony, Hur pledged to make GS a “respected company.”

Last November, the company issued a green bond worth 130 billion won that is only granted for investments for eco-friendly purposes - a first for GS. It recycled 76 percent of its refinery waste last year and sold 500 billion won worth of eco-friendly products, which accounted for 1.5 percent of GS’s entire revenue.

BY SONG KYOUNG-SON [song.kyoungson@joongang.co.kr]