Energy

Enabling the delivery of carbon-neutral refined petroleum products to end consumers

In partnership with SK Energy, Macquarie’s Commodities and Global Markets group executed a transaction that will facilitate the delivery of carbon-neutral refined petroleum products to end consumers in South Korea.

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Sector Energy
Sub-sector Global Carbon 
Location South Korea

Opportunity

SK Group, the third largest conglomerate in South Korea, is focused on reaching carbon neutrality by 2050.

SK Energy Co Ltd, a subsidiary of the group, was the first oil company established in South Korea and remains the largest in the region today. Producing refined petroleum products at its Ulsan Complex, SK Energy has a refining capacity of 840,000 barrels of crude oil per day and sells its products to both domestic and overseas markets.

SK Energy believes carbon offsets will play an essential role in the decarbonisation of the petroleum industry and have partnered with Macquarie to enable the delivery of carbon-neutral refined petroleum products to end consumers in South Korea.


Approach

Macquarie has arranged and structured a carbon offset deal that will enable SK Energy to deliver carbon-neutral refined petroleum products to end consumers in South Korea.  The carbon offsets were sourced from specific high quality forestry projects in Asia and South America that are verified under the Verra Verified Carbon Standard.

Macquarie will provide carbon accounting services through a partner platform that will assess the full lifecycle of the refined products produced at the Ulsan refinery, including oil extraction, transport, storage, shipping, refining and eventual combustion.

Macquarie will retire the offsets on behalf of SK Energy based on their sales of carbon-neutral gasoline and diesel to motorists at the pump as well as sales of carbon-neutral marine and aviation fuel in South Korea.

Outcome

Demonstrating our commitment to carbon-neutral innovation

This project is believed to be the first offering of its kind in Asia, providing motorists with the option to purchase carbon-neutral gasoline or diesel for a premium at the pump.

It is an immediately executable solution that supports SK Energy’s goal to reach net zero emissions by 2050, while simultaneously allowing everyday motorists who do not have electric vehicles, to participate in the energy transition.

Structural decarbonisation of the energy complex is a goal that we must collectively strive toward. We believe that bundled carbon-neutral products will be an important tool to bridge producers and consumers into longer-term absolute emissions reductions."

Scobie Mackay
Managing Director, Commodities and Global Markets