UPDATE 2-Japan Fuji Oil aims to triple export capacity

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SODEGAURA, Japan, May 12 (Reuters) -- Japan's Fuji Oil Co, the refining unit of AOC Holdings Inc (5017.T: Quote, Profile, Research, Stock Buzz), said on Monday it aims to triple its oil product export capacity to 3 million kilolitres (18.9 million barrels) a year by end-2009.

The company is aiming for the capacity to export 1 million kl each of gasoline and jet fuel by the end of next year, on top of the 1 million kl of gas oil it currently ships, AOC Holdings President Fumio Sekiya told reporters.

An ageing population and young drivers favouring more fuel-efficient vehicles have led to shrinking oil product demand at home, forcing many Japanese oil refiners to look at overseas markets.

The export plan came after the company began operating in late March a new gasoline-making No. 2 fluid catalytic cracking (FCC) unit at its refinery in Sodegaura in eastern Japan.

The unit converts heavy oil feedstock into more valuable products, such as gasoline, propane, kerosene, gas oil and petrochemical products such as butane and propylene.

Fuji Oil is expected to complete upgrading its infrastructure for gasoline exports in October, which would enable it to export large-scale 50,000-kl (315,000 barrels) cargoes, company sources said.

Fuji Oil, in which refiner Showa Shell Sekiyu (5002.T: Quote, Profile, Research, Stock Buzz) acquired a 6.6 percent stake in 2005, is also considering boosting kerosene exports by the end of next year, company sources said.

Previously, the company has only exported kerosene on small-size ships.