Regions

The second biggest oil refiner GS Caltex in South Korea said it had cancelled its plans to buy a refining plant with GS Energy and Petroleo Brasileiro SA. The cancellation of the refinery project was said to be over uncertainty in the project's profits, said a report from Reuters.

GS Caltex has a 775,000 barrel-per-day (bpd) refining capacity. The company said its investment should be aimed towards secondary units. This would help the oil refiner to extract higher value gasoline and diesel from heavy oils, according to GS Caltex Chairman Hur Dong-Soo on the sidelines of the World Energy Congress held last Monday.

Hur said the refinery project investment could run into billions of dollars. He added, "We decided not to go for the (Brazilian) project. We dropped it completely and so has GS Energy as we are not sure whether it is a profitable project."

GS Caltex is owned by South Korea's GS Energy and Chevron Corp, the second largest oil company in the United States.

GS Caltex said last March it had completed a 53,000 bpd heavy oil upgrading facility. The facility was worth USD1.21 billion. This had also raised its gasoline and diesel output and gave a boost to the refiner's heavy-oil upgrading capacity to 268,000 bpd.