15-11-2012

Completion of new para-xylene production unit

Cosmo Oil Co Ltd and Hyundai Oilbank produce and market para-xylene through a joint venture company, Hyundai Cosmo Petrochemical Co., Ltd. As part of the expansion in the petrochemicals business, we are pleased to announce the completion of the new para-xylene production unit.

1. Outline of Para-Xylene Production Unit
Completion Date: November 13, 2012
Production Capacity: Para-Xylene 800 kt/year, Benzene 120 kt/year. Total production capacity for para-xylene will be 1,180 kt/year including the existing capacity of 380 kt/year. Total production capacity for benzene will be 250 kt/year together with existing capacity of 130 kt/year.
Commercial Operation: January 2013

2. Background and Purpose of Building a New Para-Xylene Unit
The petrochemicals business has been positioned as an important strategy for the growth of Cosmo Oil under the "3rd Consolidated Medium Term Management Plan" and established HCP together with HDO in November 2009 for the production and marketing of para-xylene (380 kt/year).

The construction for the new para-xylene production unit (800 kt/year) at HDO's Daesan Refinery began in July 2011 to expand our business portfolio under the current "4th Consolidated Medium Term Management Plan". The construction of the new unit has been completed on November 13, 5 months ahead of the original schedule through the strong cooperation of all those involved. Commercial operation for the production and marketing of 1,180 kt/year of para-xylene will begin after commissioning and going through test operations.

The feedstock for the new para-xylene unit will be stably supplied from the Cosmo Group, mainly from the mixed-xylene production unit constructed at our Yokkaichi Refinery in November 2011. Cosmo Oil aims to increase profitability through integrated operation in the oil refining and petrochemicals business by shifting the excess gasoline fraction for use in petrochemicals.