FAQ| IR

s-oil

Customers

C·E·O

Sustainability management at S-OIL starts from understanding the expectations of C.E.O. (Customers, Employees, Owners & other stakeholders). Going forward, the Company will create economic, environmental, and social values reflecting the expectations of C.E.O. and contribute to the development of society and the nation.

S-OIL strives to deliver customer satisfaction with utmost product quality and reasonable price, and to focus on building trust with customers through various communication activities carefully designed based on customer needs. Furthermore, S-OIL continues to sharpen its overseas marketing capabilities by exploring new markets and enhancing strategic partnerships with key customers.

C1 Realization of Customer Satisfaction

S-OIL concentrates its capabilities on enhancing consumer benefits and satisfaction by offering premium quality products and services at a reasonable price. S-OIL is keen on communicating with our customers to identify their needs and incorporate them in its business activities. In addition, S-OIL pursues shared growth with service stations (S/Ss) and LPG filling stations (F/Ss), its key customers and main customer contact channels, by supporting them in enhancing their competitiveness and solidifying cooperative relations.

Reasonable Product Pricing

S-OIL makes various efforts to clear up consumers' suspicions related to product prices and maximize consumer benefits by applying a reasonable and competitive pricing policy. Implementing an independent product pricing system that takes onboard various factors that affect domestic fuel price such as fluctuations in international oil prices and F/X rates, S-OIL is leading the domestic pricing with fair and reasonable policy. Although consumers rarely feel the instant impact of lower crude oil prices firsthand due to high taxes and the lagging structure, S-OIL's Price Operation Committee convenes every day and sets standard prices of gasoline, diesel, and kerosene in the domestic market. Furthermore, S-OIL operates a competitive reward membership program that offers the best fuel purchase rewards in the industry, while bringing various customized offerings to Bonus Card members based on the Customer Relationship Management system. S-OIL also offers a wide range of discounts on fuel purchases through strategic alliances with domestic credit card companies and strives to provide customers with practical benefits by cooperating with various business partners, including Lotte Members. In particular, S-OIL launched a freight reward card that offers some of the best fuel purchase rewards in the industry, and opened a dedicated menu for truck drivers on S-OIL Mobile Point Mall, making it easier for them to use accumulated points, all in an attempt to help alleviate the burden of heavy fuel-consuming truck drivers.

Improvement of Consumer Convenience

Amid unfavorable sales conditions, such as stagnant demand for fuel products, increasing market uncertainties, and intensifying competition among suppliers, S-OIL strives to enhance customer convenience and boost its domestic market share on many fronts. For example, efforts focus on improving customer experience with S-OIL's service and products and securing a reliable source of demand by expanding sales network with S/Ss, F/Ss, and direct sales outlets. Despite the downward trend in the number of S/Ss across the country, S-OIL made a continuous effort to secure bigger sales network, thereby minimize inconvenience for customers. Furthermore, S-OIL carries out differentiated programs and engages in creative brand marketing activities to boost sales, while actively explores new business opportunities. As a result of such efforts, S-OIL captured the record-high 23.7% in domestic market share for retail light oil products in 2019.

Timely and Accurate Handling of Customer Complaints

In a bid to strengthen customer communication, S-OIL has established an integrated Voice of Customer (VOC) system, through which the Company handles and analyzes all customer feedback received via various channels including customer center, Homepage, ARS and SNS, in an integrated and systematic manner. The turnaround time for VOC is set by VOC type and reflected in KPI to allow for prompt handling. Also, S-OIL conducts satisfaction surveys on VOC handling and feeds the result back to the procedure for continuous system improvement. Status of each VOC is notified to customers via calls, SMS, and e-mails. Furthermore, S-OIL runs VOC Awareness Raising Program, which is an incentive system to recognize customers who raised constructive VOCs and employees who handled VOCs in an efficient manner. In a preemptive effort to resolve customer complaints, S-OIL has in place hidden VOC program to discover factors that may possibly cause customer discontent by visiting S/Ss, F/Ss and suppliers and address the issues. In addition, S-OIL interacts with a prosumer group called GooDoil Friends to collect valuable opinions and incorporate them in its two-way communication with customers, while operating an SNS-based one-on-one communication channel. S-OIL taps into the big data collected in the integrated VOC system to analyze trend in customer complaints, while offering S-OIL Notification Service to promote two-way communication with customers through messenger app. KakaoTalk.

Competitiveness Enhancement of S/Ss and F/Ss

S-OIL is committed to supporting S/Ss and F/Ss, its key customers and main customer contact channels, to enhance their competitiveness through various on-site programs and proactive communication. This effort has earned S-OIL first place in the S/Ss category of 2019 Korea Net Promoter Score and 2019 Korean Service Quality Index selected by the Korea Management Association Consulting, for the fourth and second year respectively. S-OIL also ranked first in the S/Ss category in 2019 National Service Awards selected by the Institute for Industrial Policy Studies for two consecutive years.
Incorporating the feedback from consumer awareness surveys, S-OIL runs GooDoil Etiquette & Clean Up campaign to improve service attitude and restroom hygiene and make customer experience more pleasant. In addition, the Smile Together campaign, which aims to create a brighter society starting with a simple act of smiling at S/Ss, has gained tremendous recognition from customers.
In order to improve service quality at S/Ss and F/Ss to meet rising customer expectations, S-OIL has operated YES Team for on-site training. YES Team consists of experts equipped with certificates and knowledge in customer satisfaction, labor relations, and other areas related to operations of S/Ss and F/Ss. In particular, S-OIL has intensified its support for customer complaint resolution by providing targeted training to respond to complaints by focusing on minimizing customer inconvenience.
S-OIL has in place a separate VOC system to listen to S/Ss and F/Ss and know their pain points, and also strives to identify and address hidden VOCs through on-site interviews. In 2019, S-OIL analyzed 91 complaints received through the VOC channels as well as hidden VOCs identified during site visits, and conducted various activities to address concerns, including ARS system upgrade and Clean Up campaigns.
S-OIL provides a wide range of well-thought-out support programs, such as on- and off-line courses, consulting by in-house consultants, and GooDoil Family Magazine to help S/Ss and F/Ss strengthen their management capabilities. Training for S/S owners and onsite training are offered by District Biz HQs and sales offices, respectively. Through GooDoil Family Magazine, S-OIL delivers up-to-date information on management, relevant laws and regulations, policies, major marketing activities and support programs. S-OIL plans to introduce a chatbot service for S/S staff, providing a new communication channel to share information on facility management, service training, and its marketing updates.
In view of dwindling profitability due to intensifying price competition, S-OIL developed competitive non-oil businesses that S/Ss and F/Ss can adopt to diversify their revenue portfolio. S-OIL has introduced non-store and small-budget non-oil business items such as car supplies sales, brokerage business, and bottled water sales for S/Ss and F/Ss. And S-OIL developed quality PB products such as urea solution, ethanol washer fluid, which are supplied at competitive prices. In addition, S-OIL launched car wash franchise service that is most closely correlated with fuel sales, which can contribute to higher profits and sharper competitiveness with a premium and standardized car wash service. S-OIL continues to develop and introduce various non-oil business items by expanding partnerships, including GreenCar, a car sharing provider, and Coupang, an online shopping platform.
In a bid to foster long-term cooperative ties with S/Ss and F/Ss, S-OIL selects S/Ss and F/Ss that achieved remarkable performance in terms of service, facility management, sales volume, and profitability, and awards S-OIL Champions Club every year. The award promotes healthy competition and shares good practices among S/Ss and F/Ss, thereby contributing to the overall improvement in station operations.
S-OIL launches various promotions and supports purchase of bottled water, wet tissue, and other promotional goods as per its yearly promotion plan that considers seasonal factors and feedback from S/Ss and F/Ss. S-OIL implements differentiated promotions taking onboard regional and seasonal characteristics, which are well received by S/Ss and F/Ss, as part of the effort to build competitiveness.

Domestic Marketing for Lube Business

Since 1981, S-OIL, the first company in Korea to produce lube base oil, has positioned itself as the market leader based on reliable supply of high-quality products. S-OIL maintains a close relationship with its customers and strong foothold in the market through customized marketing utilizing various product lines, expansion of loyal customers based on stable supply capability, and cooperation on customers' export business. In addition, in order to respond quickly to the rapidly changing market, S-OIL invites customers to a technology seminar every year and continues its efforts to improve customer services and product quality in cooperation with the Refinery and lubricant R&D resources in TS&D Center. S-OIL will continue to maintain its competitive edge in the market and strengthen its position as the leading base oil supplier in the domestic market.

Domestic Marketing for Petrochemical Business

S-OIL has been making continuous efforts to reinforce chemical business for long-term sustainable growth by enhancing its competitiveness by strengthening its status in the domestic chemical market. In the aromatics market, S-OIL is consolidating its market presence through long-term partnership with most of end-users in Korea. Strategically, S-OIL has been gradually expanding its aromatics domestic market share by securing new customers and implementing location SWAP, building upon its achievement of establishing a stable demand for para-xylene products with its pipeline in Ulsan. In addition, for benzene, S-OIL continues to expand customer base in Korea by intensifying long-term relationship for stable and profitable sales. For olefin monomer business, having logistics facilities such as pipelines is critical to maintain stable supply due to the logistical restrictions innate to gas products. For this reason, S-OIL has preemptively established pipeline networks to major end-users in Ulsan Complex and made a bridgehead for stable and timely sales to olefin downstream manufacturers. Regarding propylene, S-OIL has been reinforcing partnership with domestic customers and playing an important role to balance propylene supply and demand within Ulsan Complex through various SWAP activities. With the commercial operation of RUC, S-OIL started ethylene pipeline supply to domestic customers, utilizing logistics and partnership with end-users that the Company thoroughly prepared. S-OIL's reliable supply of olefin monomers within Ulsan Petrochemical Complex contributes not only to consolidating its presence in the chemical industry but also to strengthening competitiveness of related downstream businesses in olefin value chain by triggering downstream investments. With the successful implementation of the RUC/ODC project which enabled S-OIL to venture into the olefin downstream business, the Company is focusing on expanding its presence in propylene oxide and polypropylene at home and abroad. In 2019, stable sales base was established for propylene oxide by signing long-term contracts with majority of major polyol clients and small customers in Korea, while making a foray into the polypropylene market by acquiring a number of new customers.

C2 Product Quality Assurance

S-OIL has implemented quality management system compliant with ISO 9001:2016 international standard, to produce quality products that satisfy customers' expectations. The system is adopted across the board at S-OIL in R&D, high-quality eco-friendly product development, and quality control in the distribution phase, with the goal to providing consumers with products of top quality in a stable manner while minimizing impact on environment and safety.

Enhancement of R&D capabilities

Driven by a culture of innovation without complacency, S-OIL continues to invest in R&D activities aimed at improving product quality and advancing production facilities and works with prestigious colleges and research institutes. In pursuit of sustainable growth, S-OIL's Technical Service & Development Center (TS&D Center) strives for its sustainable growth through the development of high-quality, eco-friendly, and high-value added products.
TS&D Center established the infrastructure necessary for developing products and technologies in petrochemical and lube business sectors, and is now spearheading S-OIL's efforts to develop high-quality, high-value added products and improve product quality. In a relatively short period of two years since its establishment, TS&D Center made a remarkable progress with one polypropylene product development, one polypropylene product quality improvement, and five patent applications. In addition, S-OIL holds domestic patents on long-life gasoline engine oil and long-life diesel engine oil of improved fuel efficiency that were developed jointly with the Hyundai-Kia R&D Center. S-OIL continues to engage in joint R&D projects to develop new engine oil and transmission oil, along with various types of industrial oils to meet varying consumer needs.
S-OIL introduced the latest analysis equipment and techniques to ensure stable quality management and customer trust. Reliability of laboratory testing is assured by regularly calibrating analysis equipment through certified third-party institutes as well as in-house verification programs. S-OIL also offers training programs to improve its analysis ability, thereby securing quality testing capabilities and contributing to production efficiency.
S-OIL not only provides technical service for general troubleshooting but also distinct support customized to each and every customer such as processability evaluation, product and material analysis support, guidelines for optimizing production process and product development. Also, S-OIL hosts product and processing technology seminars all aimed at building stronger trust with customers.

Production of High-quality Eco-friendly Products

Going beyond passive response to environmental regulations, S-OIL is proactively introducing new processes as well as revamping and upgrading them to develop and supply more efficient eco-friendly products with premium quality. For example, the diesel dewaxing process was introduced to innovate the stability of diesel performance even at low temperature in winter. Moreover, S-OIL upgraded lube base oil production process, which dramatically reduced emission of Poly Aromatic Hydrocarbon, which is a hazardous chemical substance, and allowed the Company to supply more eco-friendly and safer lube base oil to the market. The additional introduction of alkylation and RFCC processes further improved gasoline quality as well.
S-OIL has in place a real-time quality monitoring system that checks in advance for any factor that may negatively affect product quality throughout the entire production process, from introduction of raw materials to market distribution. By utilizing the system, S-OIL ensures that only products that satisfy quality standards are supplied to customers. Furthermore, regular communication between Operations and Marketing & Sales organizations ensures that all products meet customer requirements. Also, S-OIL periodically participates in inter-laboratory crosscheck program organized by domestic and overseas authorities, including ASTM and K-Petro, to enhance testing reliability.
Such effort landed S-OIL numerous recognitions for highest grade gasoline and diesel products in the Environmental Quality Evaluation on Automotive Fuels. S-OIL's kerosene also obtained Eco-Labeling Certification in 1994 for the first time among Korean refiners, and has maintained the certification ever since. In addition, S-OIL ranked first in the diesel category of 2019 Korea Brand Recommendation index by the Korea Management Association Consulting for four straight years.

Enhancement of Quality Management in Market Distribution Process

S-OIL is dedicated to systematic product quality management throughout the market distribution process, as well as in the production process, with the aim to prevent pollution or quality degradation of products at S/Ss and F/Ss and ensure customer's rights to purchase products with specified quality and quantity.
S-OIL takes a systematic approach to quality inspection on S/Ss and F/Ss as well as prevention activities. Diverse possible means are tried to ensure efficient quality control such as injecting specific markers, running onsite handy analyzers, abnormal symptom monitoring system, itinerant training on quality assurance by quality managers, and checking dealer information. S-OIL runs the Product Quality Tracking System which integrates product distribution and quality information encompassing the Refinery, S/Ss, and customers to trace back distribution routes. In addition, S-OIL puts efforts to provide customers with the best quality products and apply strictest penalties including de-branding to S/Ss and F/Ss selling fake oil.
S-OIL operates Trustworthy S/S program where the Company guarantees products sold at S/Ss according to quality and quantity specifications to allow customers to easily purchase high-quality products. At least six quality inspections a year and periodic quantity specification inspection are a prerequisite to be qualified as Trustworthy S/S. S-OIL also puts up signs to let customers know that they are purchasing fuel products from a Trustworthy S/S, and swiftly provides information on the quality of products they purchase using S-OIL notification service on KakaoTalk.

C3 Marketing Communication

S-OIL strives to contribute to the development of the national economy and society through diverse and creative marketing and communication activities that were undertaken to deliver best quality products as well as active interaction with customers. Acknowledged for such efforts, S-OIL received the grand award in the brand management category at 2019 Management Grand Awards by the Korea Management Association Consulting for three consecutive years, and ranked first in the S/Ss category in 2019 Korea Brand Hall of Fame by the Institute for Industrial Policy Studies. S-OIL also ranked 41st on the list of the 2019 Best Korea Brands Top 50 selected by Interbrand Korea, which highlighted its strong brand value.

Brand Marketing as a Medium for Customer Communication

Since 2018, S-OIL has been launching an advertising campaign under the theme "Start-up with Good Oil," sending positive energy and cheers to all customers. The advertisement series resonate with customers and create a positive image that oil is not just the fuel that makes the car move but also serves other meanings and purposes in social contexts. S-OIL produced various viral videos along with TV commercials to tap onto the latest trend of communication through mobile devices and social media. Through this effort, S-OIL recorded more than 54 million views on SNS, recording 62.6% in the top of mind awareness (TOM), which is unprecedentedly high among Korean refiners.
S-OIL has been promoting the GooDoil character as a symbol of good oil for diverse marketing activities at S/Ss and F/Ss, events and promotions as well as advertising campaigns in order to get in closer touch with customers and more closely relate to them. In line with the evolving social trends, S-OIL has expanded brand promotion and marketing activities utilizing various SNS platforms and influencers. Taking on board customers' opinions and suggestions, S-OIL launched GooDoil characters and opened more character shops. Other activities included opening GooDoil park golf course, and installing GooDoil Hopefull Station at Seoul COEX, thereby offering customers more chances to meet GooDoil characters and feel good oil more.
S-OIL builds a dynamic, friendly yet prestigious brand image through its support for diverse sports and cultural events. S-OIL hosts the KLPGA S-OIL Championship and sponsors S-OIL Championship Pro-Am to offer premium service and exclusive values to customers. In addition, S-OIL engages in creative and comprehensive sports marketing activities using GooDoil Family characters, including outdoor advertising and promotions at the Lotte Giants' home baseball stadium. To strengthen ties with customers and provide them with greater cultural benefits, S-OIL also organizes events such as Culture Date and Cinema Date. In particular, S-OIL invites Bonus Card customers and partner dealers to special cultural events giving them a good chance to enjoy high-quality cultural performances.
S-OIL carries out various promotional activities to provide more practical benefits to customers who visit its S/Ss and F/Ss and increase their satisfaction. As part of this effort, S-OIL holds the GooDoil Family Sweepstake at S/Ss and F/Ss across the country every year, and gives out diverse free gifts such as GooDoil characters, daily goods, and vehicle supplies. S-OIL also runs mobile point shopping mall to help its Bonus Card members easily use their bonus points, issues vouchers, and offers free giveaways for those purchasing with accumulated points, thereby enhancing customer experience in general.

Creation of a Friendly, Socially Responsible Company Image

S-OIL strives to build an image as a friendly company that fulfills social responsibility and interacts with various stakeholders, based on creative and unique corporate image advertisements. Not only does S-OIL run public interest campaigns on the front page of major daily newspapers, it also delivers useful information to various stakeholders in a timely manner to promote broader interaction. In 2019, customers gave positive feedback on the programs S-OIL launched, including Quote-a-day campaign, Fill-the-blank campaign, Mental Health campaign, and Start-up with Good Oil campaign. S-OIL also won 2019 Good Advertising Award hosted by the Korea Advertisers Association in the print advertising section with original advertisements based on For Heroes, which is the flagship CSR program. In addition, S-OIL has erected a huge panel against the external walls of the Head Office which conveys written messages of hope and consolation and strengthens cultural as well as emotional bonds with the local community.

C4 Fair Competition in Market / Protection of Customers' Personal Information

S-OIL's efforts to play by the rules for fair competition and protect customer interest are upheld by the core corporate value of integrity and top management's strong commitment to compliance. S-OIL also preemptively responds to the increasingly stringent the Personal Information Protection Act and the Act on Promotion of Information & Communications Network, and implements the systematic information protection policy for its critical information and personal information of all stakeholders including customers. In recognition of its privacy protection efforts, S-OIL obtained certification on Information Security Management System (ISMS) and Personal Information Management System (PIMS) from the government for the first time among Korean refiners.

Fair Competition in Market

S-OIL's commitment to reinforcing compliance management is championed by top management's leadership, especially in relation to fair trade laws. To ensure that compliance management is adhered to by all employees, S-OIL published a compliance manual and must-follow guidelines “Dos & Don'ts” for sales activities. S-OIL also holds fair trade training sessions by inviting an external lecturer every year to raise employees' awareness on compliance with relevant laws. S-OIL carries out regular and ad-hoc self-assessments on its compliance system to check any violation of fair trade laws in business operations. In addition, S-OIL actively assists employees' compliance with fair trade laws by providing real-time legal updates on the latest legislation and revisions on relevant laws and regulations, conducting training sessions on major legal requirements, and regularly monitoring compliance with fair trade law. When entering into a contract with a business partner, S-OIL utilizes a standardized written contract that reflects the recommendations from Fair Trade Commission. Moreover, S-OIL has reflected mandatory terms and conditions of trade in its written contract in full compliance with Fair Agency Transactions Act.

ISMS-based Critical Corporate Information Protection

S-OIL's information protection is comprised of managerial, technical, and physical areas. ISMS is utilized Company-wide to ensure systematic information protection and risk management activities. In the managerial area, S-OIL has a dedicated Cyber Security Team and holds Information Security Committee chaired by Chief Information Security Officer (CISO) twice a year to review its major information security policies and action plans, track progress, and push forward efforts to raise information security awareness. To that end, information security training is provided to all employees twice a year, and online training programs are also offered. A simulated phishing drill is carried out more than four times a year to make sure employees know how to respond to malicious e-mails. In order to stay ahead of evolving hacking technologies, S-OIL also makes continued efforts to sharpen its counter cyber-attack capabilities by acquiring latest security technologies and closely cooperating with information security companies. On the technical side, all IT systems at S-OIL are safely operated as per the domestic security standards and addressed for security weaknesses through periodic hacking simulations and security patch updates. In addition, monitoring and analyzing of centralized logs of IT systems allow S-OIL to be more proactive in preventing likely and predictable attacks. S-OIL is continuously enhancing its capabilities to respond to ever-sophisticating cyber-attacks. For efficient response to Advanced Persistent Threat (APT) and unknown malware, in particular, S-OIL introduced APT attack prevention solution that detects abnormal activities on both network perimeters and user computers. In parallel, S-OIL implemented a web security solution that blocks unauthorized file modification and malicious files to raise its website security posture. To ensure physical security, S-OIL's major IT systems are located in a data center equipped with one of Korea's best security solutions, safeguarding its IT assets from physical intrusions from outside.

PIMS-based Systematic Personal Information Protection

S-OIL protects personal information in a systematic way through PIMS. In full compliance with Personal Information Protection Act and to minimize personal information leakage risk, S-OIL eliminates sensitive personal information, such as resident registration number, entirely from its customer database. In addition, Cyber Security Team is accountable for making continuous improvement to the work process to minimize handling of personal information and monitor how personal information is accessed, stored, and altered in real time. Furthermore, in cases where personal information is shared to an outsourcing partner for the purpose of operating bonus card system, S-OIL uses a solution that sets the expiry date for the third-party use of such information and deletes it immediately upon expiry, thereby keeping the risk of personal information leakage involving an outsourcing company to minimum. S-OIL safely stores personal information with encryption, implements control access through the personal information access control system, and systematically monitors access history accordingly. S-OIL effectively limits personal data access on an as-needed basis by allowing access rights only to IT system managers and certain teams requiring personal data access. Furthermore, access can only be made through the Virtual Desktop Infrastructure system that separates Internet and business networks or the Server Based Computing system that blocks Internet connectivity, thereby minimizing potential risk of customer information leakage. Additionally, system access authorization is exclusively granted with two-factor authentication requiring both password and One Time Password (OTP). S-OIL provides all employees and contractors' employees who handle customer personal information with periodic privacy protection training including online training at least twice a year. In addition, S-OIL operates a hot line for employees to report any suspicious behaviors or situations related to information leakage and investigates them according to the internal procedure.

C5 Overseas Marketing

S-OIL spearheaded transformation of the refining industry from a simple manufacturing industry for domestic market into a high value-added export industry, thereby making significant contribution to the national economy and social development. At the center of this transformation stands S-OIL's strategic expansion into overseas markets, which now accounts for more than 50% of its production every year. Providing customers with excellent quality and competitive products, S-OIL is actively consolidating its position across overseas markets.

Overseas Marketing for Fuel Business

Armed with production capabilities for high value-added products secured through preemptive investments, S-OIL was an early mover to expand into Japan, Australia and other major overseas markets ahead of its competitors, consequently building a strong customer base and brand awareness. S-OIL is flexibly responding to strengthened product specification requirements in those markets and meeting diverse customer needs by improving export operation capabilities and logistics system. Such efforts have enabled S-OIL to grow into a major supplier in the region. Now in view of increased competition in key strategic markets, S-OIL established direct sales relationships and strategic partnerships with major clients, aiming to obtain stable sales networks. In addition, S-OIL makes consistent efforts to boost sustainable sales capabilities and plans to acquire local sales networks in core strategic markets in a bid to create a major market base second to Korea. In parallel, S-OIL has bolstered its influence and sales basis in overseas markets and explored new business areas for additional profits by forging closer collaborative relationships with Saudi Aramco, which is its major shareholder, and its affiliate companies. Going forward, S-OIL plans to further expand its sales base by increasing production of the high value-added light oil products thanks to the successful completion of the RUC/ODC project, while continuing its efforts to promote marketing capability that will help the Company navigate through the ever volatile market environment, such as the IMO's tougher regulations on sulfuric content on marine fuel, in a more proactive manner.

Overseas Marketing for Lube Business

S-OIL is posting stable sales of the entire production stock of lube base oil by employing marketing strategies tailored to each market. S-OIL is also actively utilizing its lube base oil production capacity, which is the second biggest single location plant in the world. In 2019, S-OIL secured additional sources of demand through long-term contracts with major clients, and found new long-term business agreement partners in Asia and Europe. In particular, S-OIL expanded sales base through the establishment of Aramco Base Oil Alliance, and explored new revenue creation opportunities by establishing S-OIL Singapore Pte. Ltd. for lube oil product trading. Lube R&D Center located inside TS&D Center is in operation to reinforce the Company's core capability in the lube business and S-OIL strives to keep customer loyalty based on stronger and stable product supply capacity as well as thorough quality control, in tandem with the increasing demand for premium lube base oil products. For lubricant business, S-OIL has cemented a solid position in the market on top of positive response from home and abroad by integrating the lubricant brand as “S-OIL Seven”. Keeping up the momentum, S-OIL expanded the lubricant logistics hubs for more efficient inventory management and reinforced local marketing activities, participating in overseas exhibitions and holding dealer conferences. As a result, S-OIL successfully made inroads into nine new overseas markets and opened six new agencies in 2019, expanding exports to over 60 countries including strategic markets like China, Vietnam and Russia.

Overseas Marketing for Petrochemical Business

S-OIL diversifies its marketing activities depending on the market taking on board different characteristics of each petrochemical product. As for para-xylene, although excess supply is expected with China's recent massive capacity additions, S-OIL is working hard to secure both stable and profitable sales outlets by expanding business with existing key customers while developing new customers in overseas market. For benzene, S-OIL has been nurturing long-term partnership with end-users in the US, where steady import demand is anticipated, while diversifying regional export portfolio to be prepared for increasing benzene self-sufficiency in China. In addition, for production of propylene oxide and polypropylene, the major deliverables from the RUC/ODC project, S-OIL successfully entered major markets across the world, including China, Southeast Asia, and Turkey, thanks to the proactive premarketing and strategic alliance with Saudi Aramco Products Trading Company. As illustrated above, S-OIL is actively consolidating its position across overseas markets by preemptively responding to the rapidly evolving petrochemical market environment and is committed to staying at the frontier as a market leader.
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