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SK Innovation to focus on new markets, tech revolution

SK Innovation Co. CEO Koo Ja-young said Thursday that the firm will speed up the technology revolution and investments in new growth engines with a sales target of 5 trillion won ($4.4 billion) by 2015.

The firm, parent of the nation’s biggest oil refiner SK Energy, spun-off of its petroleum and petrochemical operations on Jan. 1.

Koo saw the future of the firm in world-leading technologies such as green coal, lithium-ion battery separators and solar cells, he said. It will also step up overseas resources exploration and production, he added.
SK Innovation CEO Koo Ja-young
SK Innovation CEO Koo Ja-young

“We are pursuing a transformation to a technology-driven company through innovation. Though currently half of our profits come from refining business, we plan to change that in the next five years,” Koo told reporters.

“Because we are competing in a red ocean market, we are seeking ways to concentrate on globally prospective, high-tech sectors.”

Under the new organization, subsidiaries and units under the firm ― including SK Energy, SK Lubricants and SK Global Chemical ― will adopt a more independent and flexible management which can help maximize their performance, according to Koo.

Meanwhile, on the government pressing refiners to cut profit margins to control surging petrol prices in the country, Koo showed intent to cooperate with the government, but without mentioning specific plans.

“I understand the government’s stance very well. Because it is part of its efforts to curb inflation, we are willing to cooperate,” he said. “I think doing so is necessary for us to achieve ‘inclusive growth’ and is also part of our corporate social responsibility.”

Koo, however, did not comment on whether or when the firm is going to reduce its supply prices.

He also dismissed allegations on possible price-fixing of four local refiners ― SK Innovation, GS Caltex, S-Oil and Hyundai Oilbank, saying that their production cost and pricing structure is clear.

Koo also discussed its growing battery business. The firm said Wednesday it will supply lithium-ion batteries for Daimler AG’s Mercedes-Benz SLS AMG E-Cell supercar.

Despite a late start and consequent lack of manufacture facilities, the firm’s solar cell business has been doing increasingly well, Koo said.

SK Innovation is competing with chemical maker LG Chem for a share of the car-battery market and has provided products to Hyundai Motor Co.’s BlueOn, the country’s first-ever full-speed electric vehicle introduced last year.

As part of its joint projects with foreign firms, Koo said SK Global Chemical subsidiary aims to hold a 35 percent stake in Wuhan petrochemical plant project in China by Asia’s top refiner Sinopec Corp.

By Koh Young-aah (youngaah@heraldcorp.com)
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