S Korean GS Caltex buys another 1 million barrels US Eagle Ford crude

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South Korea’s second-biggest refiner GS Caltex said Monday it has bought another 1 million barrels of US crude from the Eagle Ford shale play in Texas. The cargo is scheduled to arrive at Yeosu port in December, a company official told S&P Global Platts.

GS Caltex operates four crude distillation units at the Yeosu complex with a combined capacity of 785,000 b/d.

The company will use the light sweet crude for blending with heavier crudes, the official said, adding that Eagle Ford crude has an API gravity of 45-56 degrees and less sulfur content.

The 1 million barrels of Eagle Ford crude bought in July reached Yeosu on Sunday and would be unloaded by Tuesday, the official said.

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This is South Korea’s first purchase of US crude since Washington lifted a 40-year restriction on exports late last year.

GS Caltex, a 50:50 joint venture between South Korea’s GS Group and Chevron Texaco, bought 395,000 barrels of US condensate in September 2014, South Korea’s first import of US ultra light oil.

The refiner bought 800,000 barrels of Alaskan crude in October 2014, and another 1.2 million barrels in 2015. It also imported 400,000 barrels of US condensate in March this year.

Rival refiner SK Innovation bought 400,000 barrels of US condensate in 2014.

The official declined to disclose the price paid for the latest Eagle Ford crude cargo, but said the imports were possible thanks to «weaker WTI crude prices, and lower shipping costs as the cargo was co-loaded with Mexican crude.» GS Caltex had bought 1 million barrels of Mexican crude.

«The purchase of the US crude is part of our efforts to diversify supply sources. We will make more efforts to import cheaper crude from sources other than the Middle East,» the official said.

–Charles Lee, newsdesk@spglobal.com
–Edited by E Shailaja Nair, shailaja.nair@spglobal.com

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