SK Energy to buy 35 pct of naphtha JV with Sinopec

SEOUL, May 28 (Reuters) - South Korea's largest refiner SK Energy (096770.KS) confirmed on Wednesday it had agreed to buy a 35 percent stake in a joint venture with Sinopec Corp (0386.HK) to build a petrochemical complex in central China.

SK Energy declined to reveal the value of the deal but an industry source told Reuters last week the investment would be around 1 trillion won ($956.2 million).

The deal, which coincides with South Korean President Lee Myung-bak's visit to China this week, makes SK one of a handful of foreign firms to invest in China's huge petrochemical industry, which has been expanding at a double-digit annual rate in recent years.

SK Energy said in a statement the plant, which is already under construction in Wuhan City in central China, will have annual capacity of 800,000 tonnes and will begin operation by the end of 2011.

A Sinopec official had on Monday said that SK may take a 25 percent stake in the venture, although the South Korean industry source said last week the refiner was considering a stake of around 35 percent. (Reporting by Miyoung Kim; Editing by Keiron Henderson)