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649

Nippon Oil to Cooperate Alliance With Korean Refining Giant

Nippon Oil Corp. has agreed to form a business and capital alliance with South Korea's largest oil refiner

Nippon Oil Corp. has agreed to form a business and capital alliance with South Korea's largest oil refiner, SK Corp., in an effort to sharpen its global competitiveness and keep up with growing demand for energy in Asia's fast-growing economies, including India and China.

Nippon Oil, Japan's largest oil distributor, and SK will each spend about 12 billion yen to acquire a 1 percent stake in each other, President Shinji Nishio said at a news conference Monday.

Nippon Oil and SK will cooperate in such areas as development of natural resources, mutual supplies of petrochemical products and joint use of production and distribution facilities.

Under the deal, the tieup is valid for the next 10 years, but Nippon Oil and SK can renew their partnership if they wish, the Tokyo-based company said, adding the two may raise their stakes from 1 percent in the future.