SK Energy (South Korean energy and petrochemical conglomerate) has bought a 35% stake in state-run Sinopec's 8.5 million m tpa Wuhan refinery in China, in a bidto widen its footprint in the world's second-largest economy, as per SP Gobal Platts. The deal marks SK Energy's first major oil refining investment in China and adds to its existing partnership in the adjacent Wuhan petrochemical plant, making the Wuhan refinery and petrochemical complex the single largest joint energy project between China and South Korea.
Sinopec-SK Wuhan Petrochemical, a joint venture between SK Energy's unit SK Global Chemical and China's Sinopec, bought the Wuhan refinery from Sinopec in April. The venture was formed in October 2013 to operate an 800,000 m tpa ethylene plant in Wuhan, with SK Global Chemical holding a 35% stake and Sinopec owning 65%. Under the latest deal, SK Global Chemical's board approved an investment of Yuan 1.1 bln (US$160 mln) and Sinopec agreed to spend Yuan 2.05 bln (US$298 mln) on the expanded joint venture, valuing the Wuhan refinery at Yuan 3.15 bln (US$458 mln). The new shareholder structure at Sinopec-SK Wuhan Petrochemical remains unchanged with SK Global Chemical owning 35% and Sinopec 65%.