South Korea’s top oil refiner SK Corp. announced Friday it was planning to set up a US$30 million petrochemical joint venture in Shanghai with Chinese oil giant Sinopec.

The project was part of SK’s plan to tap the fast-growing Chinese market, the South Korean company said in a statement.

The joint venture, Shanghai Gaoqiao-SK Solvent Co., will be 50:50 owned by the two partners. It is expected to start commercial production by the second quarter of 2006 with an annual solvent output of 60,000 tons.

"Our ambition is to become the leading energy/chemicals corporation in the Asia-Pacific market and to establish our presence in this sector at a global level,” Kim Chi-hyung, senior vice president of SK’s chemicals business, said in the statement.

Solvents are used in the chemical processing of a vast range of products including paints, inks, cleaners and glues. China’s overall solvent market was estimated at 2.7 million tons a year with a projected annual growth rate of 10-15 percent, SK said.

In recent years, SK has been speeding up its efforts to boost its presence in China due to growing demand here and a sluggish market in South Korea. It expects to gross annual sales of more than US$5 billion in China by 2010.

In a separate development, SK said it had entered a joint venture with Zhejiang Province Highway Materials Co. Ltd. for the operation and management of an asphalt distribution facility.

SK would hold a 51 percent stake in the venture with a total investment of US$6 million, the company said.

(Shenzhen Daily November 29, 2004)