UPDATE 2-S.Korean refiner S-Oil submits bid in KNOC land tender -source

Mon Feb 17, 2014 5:05am EST

Related Topics

* KNOC seeking buyer with $4.7 bln refinery, petchem investment plan

* KNOC offering 227-acre site in refining centre Ulsan

* Result to be available on Tuesday -tender document (Adds S-Oil's bidding, tender closing)

By Meeyoung Cho

SEOUL, Feb 17 (Reuters) - Third-largest South Korean refiner S-Oil Corp submitted a bid to acquire land for a refinery or petrochemical plant it has been planning in a public tender that closed on Monday, said an industry source familiar with the matter.

Korea National Oil Corp (KNOC) closed the tender to sell land to a refiner or petrochemical maker to build a 5 trillion won ($4.70 billion) refining or petrochemical plant at 4 p.m. (0700 GMT), the state-run oil company said in a tender document.

The tender offered 92 hectares (227 acres) of land for 519 billion Korean won ($488 million), the invitation on a public tender web site (www.onbid.co.kr) showed.

KNOC has said that potential bidders must submit approvals from their boards of directors for a refinery or petrochemical plant investment plan as one of the qualifications for participating in the tender for the land.

S-Oil has not finalised what sort of facility it will build if the land is acquired, said the industry source, who declined to be identified due to the sensitivity of the matter.

South Korea media have been reporting that S-Oil has been asking the government to help it get land for its project.

An S-Oil spokesman declined to comment on the matter; a KNOC spokesman declined to disclose the list of participants.

Results of the tender are due to be available at 11 a.m. on Tuesday, according to the tender document.

S-Oil, with 669,000 barrels per day of refining capacity, is looking to expand its paraxylene plant by buying the land from KNOC, according to local media reports.

Paraxylene, used to make clothing and plastic bottles, is produced by processing naphtha, a refined product of crude oil or condensates. S-Oil has a 740,000-tonnes-per-year paraxylene plant as part of its refinery and petrochemical operations.

The land on sale is located in the city of Ulsan, over 300 kilometres southeast of Seoul. S-Oil's refining facility is in the same city.

S-Oil's largest shareholder with a 35 percent stake is Aramco Overseas Co B.V., a unit of Saudi Arabian Oil Company (Aramco).

($1 = 1063.4 Korean won) (Reporting by Meeyoung Cho; Editing by Tom Hogue)

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