Good morning. We will now start the 3Q Earnings Conference Call for SK Innovation. Good morning. I am Jung So-young, from the IR team at SK Innovation. Thank you for joining the company's third quarter 2024 earnings presentation. I have with me SK Innovation CFO, Kim Jin-won, Lee Woo-hyun, Head of IR, and the members of management from each business subsidiary. For the agenda today, CFO Kim Jin-won will first run through the company-wide business results for the third quarter, followed by presentations from each of the officers of each business division, after which we will have a Q&A session. Please note that the earnings we're presenting today have not yet been audited by the external auditor and thus are subject to change upon the review. With that, I will invite CFO Kim Jin-won to present the third quarter performance. Good morning. I am Kim Jin-won, CFO of SK Innovation. Allow me to start by thanking shareholders, investors, and analysts for your continued interest in the company, and I will begin with the highlights of the third quarter 2024 business performance. First, as of November 1st, SK Innovation completed its merger with SK E&S. At the extraordinary shareholders' meeting held on August 27th, 85.75% of the attending shareholders voted in favor of the merger, and the level of shareholder appraisal rights e xercise was 335 billion KRW, which was less than half of the 800 billion KRW initially budgeted by the company. Based on the strong support from our shareholders, the merger of SK Innovation and SK E&S was successfully completed. With this merger, the company will strengthen the competitiveness of its energy portfolio and integrate the businesses, resources, and capabilities of the two companies to continue efforts to grow into a leading energy company not only in the Asia-Pacific region but in the global market. Second, amid continuing internal and external uncertainties and slower demand growth, SK On's efforts to improve profitability and some gains from reconciliation activities with customers led to the company reaching break-even on an operating profit basis. In the fourth quarter, key customers will be going online with new capacity in North America, and in 2025, new cars will be launched, which we expect to result in an increase in battery shipments. Lastly, on October 30th, the company announced its corporate value enhancement plans, which include a target ROE of 10% and total shareholder return of 35% as of 2027. Through the merger with SK E&S, the company has been able to create a foundation for a stable financial structure and will continue to accelerate synergies to continue to strengthen shareholder return. This concludes my discussion on the third quarter highlights. Now, let me delve into the Q3 business performance in more detail. On the third quarter top line, weaker sales from the refinery business, driven by lower oil prices, led to total sales declining KRW 1,142.2 billion quarter on quarter to KRW 17,657 billion. In terms of operating profit, though the profitability of the battery business improved, inventory-related losses from lower crude prices and weaker key petrochemical spreads led to operating profit falling KRW 377.5 billion QoQ, resulting in a loss of KRW 423.3 billion. On the non-operating profit side, FX-related gains from a stronger won and product derivative gains from lower oil prices led to a QoQ improvement of KRW 175.5 billion, resulting in a non-operating loss of KRW 306.3 billion. In detail, FX-related gains was KRW 118.7 billion, product derivative gains KRW 73.9 billion, debt-interest expenses KRW 277.9 billion, equity method losses KRW 14.8 billion, and other expenses KRW 206.2 billion. Next, let me walk you through our financials. As of the end of the third quarter, total assets were KRW 85,173.9 billion. When compared to the second quarter, tangible assets increased by around KRW 6.7 trillion due to new battery capacity constructed overseas, but trade receivables dropped by approximately KRW 0.9 trillion due to lower crude prices. Liabilities totaled KRW 53,176 billion, and borrowings grew by KRW 3.3 trillion due to an increase in CapEx. The debt-equity ratio was less by 3 percentage points versus the end of 2023 at 166%. Next, we will present the Q3 performance by business line. The performance and outlook for each area will be presented by management from the respective businesses. First, the petroleum business. Son Seong-cheol, Head of Corporate Planning from SK Energy, will give the presentation. Good morning. This is Son Seong-cheol, Head of Corporate Planning from SK Energy, and let me go over our petroleum business. In the third quarter, concerns of a recession in the U.S., Europe, and China, coupled with less refinery demands from China, created an unfavorable macroeconomic backdrop. Oil prices and refining margins weakened, which led to the operating profit of refining decreasing KRW 760.8 billion QoQ to a loss of KRW 616.6 billion. To elaborate, crude prices slightly improved in the beginning of the third quarter due to expectations of rate cuts in the U.S., but later on, concerns on less crude demand in China and a global recession were highlighted during the quarter, which resulted in a drop in oil prices. In particular, September U.S. manufacturing and employment index numbers were weak, fueling concerns about a slowdown in demand, which led to a fall in 2024 of Dubai prices of $71. On the market demand side, though this Q3 is a high season, mobility and industrial demand was less than expected, leading to a limited improvement in the market. In addition, U.S. refineries maintained high utilization levels without any issues, and new capacity added in the Middle East increased supply, leading to a weak product market. In short, lower crude prices and a more challenging product backdrop resulted in weaker refining margins and inventory-related losses in the third quarter, and the operating profit of the business also declined QoQ. Next, let me discuss our market outlook for the fourth quarter. In the case of crude, concerns about a global recession still persist, but the U.S. continues to post solid growth, and there are higher expectations about economic stimulus measures in China, which we expect to support the lower band in oil prices. On product demand, the rate cuts in the U.S. and economic stimulus measures in China, coupled with seasonal events such as an increase in reserve demand for heating purposes, is expected to result in a recovery in demand levels. On the supply side, in October, TAs in Europe and the Middle East are expected to decrease supply, and if that happens, this is expected to support the lower bound. In conclusion, less concern about a global recession together with less supply during the fall turnaround peak season is expected to drive a recovery in refining margins in the fourth quarter. Thus, the company is planning to adjust utilization according to the developments in refining margins and market outlook to ensure it can be flexible in an ever-evolving market. Thank you. Thank you. The next presentation on the petrochemicals business will be given by the Head of the Management and Planning Office of SK Geocentric, Kim Yong-soo. Good morning. I'm Kim Yong-soo, Head of the Management and Planning Office from SK Geocentric. I will present on the petrochemical business. Despite an uptick in sales volume after the completion of scheduled turnaround in Q2 for No. 2 PX, there was inventory impact following a decline in spot price and major petroleum spreads, which drove profit down by KRW 113.8 billion QoQ, and the business reported a loss of minus KRW 14.4 billion. Moving on to Q4 market outlook for each product category, let's first take a look at paraxylene PX, which is the company's core aromatics product. Undampened demand for gasoline blending, bearish MX market triggered an increase in PX utilization, and coupled with concerns over China's slowdown, we saw a sharp decline in spread in September. In Q4, on the back of higher polyester demand for winter clothing needs and new PTA capacity coming online, there will be recovery in demand, which is expected to push up spread as compared to September. For benzene in Q4, due to new capacity additions from China and regional and global year-end destocking activities, spread is expected to be softer versus the third quarter, but will still be at elevated levels both on a year-over-year basis and versus per annum average. For the olefins, although we see very little improvement in the demand and supply dynamic, once the effect of Chinese government's pump priming measures starts to feed through, we may be able to see improvement in demand. Thank you. Next, Kim Seong-won, PL of Corporate Planning and Management Office of SK Enmove will present on the Q3 lubricant business result. Hello. I'm Kim Seong-won, PL of Corporate Planning and Management from SK Enmove. Despite negative inventory effect following the dip in raw material prices, increases in sales volume and margin improvement drove operating profit up by KRW 22 billion QoQ, reporting KRW 174.4 billion. Despite weaker ASP trend in the third quarter, lower cost base following crude price decline drove stronger spread versus last quarter. In terms of sales volume, on the back of economic slowdown in China, demand from Asia was temporarily bearish, but rise in sales volume in U.S. and Europe supported robust performance. Usually, fourth quarter is start of the off-season, but on anticipation of China's stimulus measures and possibly a recovery of domestic demand, drivers behind weaker demand may mitigate, and we expect sales volume to be similar to the level seen in the third quarter. All in all, the sales volume will be quite similar to that of Q3, and spread is also expected to be at steady state with profitability kept in the positive domain. Next, from SK Eartho n, Chi Yong-min, Head of Planning and Support, will present on Q3 E&P business. Good morning. My name is Chi Yong-min, Head of Planning and Support from SK Eartho n. On the back of decline in crude price and compelling selling price reflecting higher% of gas content, and due to a slight downturn in production, Q3 operating profit for the E&P business fell 11 billion KRW QoQ to 131.1 billion KRW. In Q4, we have plans to drill two exploration rigs in Vietnam block and increase production from China 17/03 block, which are in step with our endeavors to scale up our core competitiveness. Also, in July, we newly acquired operation rights to Ketapu block in Malaysia. We also have operatorships in the nearby SK427 block, and thus we'll be able to create synergies across these E&P sites and increase likelihood of success in exploration. We plan on adding more blocks regarded as having good potential in Southeast Asia, which is our strategic region with a view towards sustaining the growth momentum. Next, on battery business, CFO of SK On, Kim Kyung-hoon, will provide you with the details. Good morning. I am Kim Kyung-hoon, CFO of SK On. I will walk you through the company's Q3 battery business results. On continuing downward trend in battery ASP guided by metal price declines, Q3 revenue was down 122.7 billion KRW QoQ to 1,430.8 billion KRW. Levers impacting operating profit include depletion of high-cost inventory, base effect of downtime loss, and initial ramp-up costs from the new facility in Hungary last quarter, cost structure improvement, and payments settled by clients, which drove turnaround of KRW 24 billion in quarterly profit. However, in terms of AMPC, which is a credit given to batteries produced and sold inside the U.S. due to recalls and temporary halt in production at customer sites, sales volume was down, in turn driving AMPC down QoQ to KRW 60.8 billion. Demand recovery in 2024 is slower than originally expected, but we expect sales volume to inch up slightly following new capacities for finished vehicles and OEMs coming online in North America in Q4 and new car launches slated for the first half of 2025. Lastly, merger with SK Trading International was completed as of November the 1st, reinforcing the foundation for financial stability and strengthening sourcing capabilities for raw materials, and as per our disclosure, we will also complete the merger process with SK Enterm by 1st of February 2025. Next is on the materials business. The materials business saw its losses widen due to a decline in sales volume to major customers. However, we expect to see gradual improvement in sales to new customers as we move into the fourth quarter. This ends our presentation, and we will now start the Q&A session. Before taking live questions, we would first like to address a few questions that we received in advance on our website. Prior to this earnings conference call, we received questions from the investors and analysts, and to be effective in responding to those questions, we selected most frequently asked questions and will provide the answers through simultaneous English interpretation, so moving on to the first question, it is on the second half of 2025 outlook for SK E&S. The response will be delivered by Im Sol-ok, who is the Head of Finance, Financial Unit 2. Now, before answering your question, merger between SK Innovation and SK E&S was complete as of November the 1st, so Q3 earnings for SK E&S was not included in the company's third-quarter presentation. However, we will be able to share with you the details of SK E&S's earnings starting Q4 earnings call, which is scheduled for early next year. Let me first present on the second half outlook. We expect SK E&S will sustain solid performance on the back of profit enhancement efforts spanning all of its businesses. For its electricity and LNG business, we saw record-high demand following heat wave in August and hot temperatures continuing into September, and based on competitive LNG supply, power plant operation has been quite steady, and for the city gas business, despite decline in sales due to depression in economy, we expect solid earnings to follow thanks to new revenue sources such as fuel cells. We project geopolitical risk in the Middle East may deepen, and impact of La Niña could trigger extreme winter temperatures until the end of the year, and so we plan to control LNG inventory at steady levels for running the power plant and focus on optimized operation. Next is outlook for 2025. Global LNG market is facing tight supply on delays in commercial operation of new LNG projects, and on the resumption of gas supply between Russia and Ukraine and China's economic situation, LNG spot price in Europe and Northeast Asia will experience significant volatilities. For the electricity market, demand will not increase that much, but on the impact of baseload generation capacity, which either has come online in 2024 or is expected to be added in 2025, we expect competition between LNG plants for dispatch orders will intensify. Even in the face of such headwind, SK E&S will secure in a timely manner low-cost LNG supply from Gas Reserve in Barossa of Australia, whose commercial operation will commence from second half of 2025 in order to drive cost competitiveness and generate steady profit grounded on integration of our LNG value chain. We will also generate meaningful levels of operating profit from other businesses, including city gas and renewable energy business. Thank you for that answer. Moving on to the next question is SK On's CapEx outlook for years 2025 and 2026. I will ask CFO Kim Kyung-hoon of SK On to respond to this question. Yes, thank you for the question. On slowdown in EV market growth, we are closely monitoring customer demand and market development to lower the planned CapEx or push back investment schedule so that we may be able to manage CapEx in a more flexible manner. We are currently collating CapEx items for FY25 business planning, and since a major part of 2024 CapEx, which are both a joint venture project with Hyundai Motor Group in North America, have been invested this year, we expect CapEx to be significantly lower as we move into year 2025. In terms of financing, we are not only tapping into financing from financial institutions, but also policy-directed funding from Korea and abroad, and use JV partner loans to secure a steady stream of funds and minimize funding costs. Out of three plants under the BlueOval SK project that we are building with Ford, Kentucky Plant No. 1 and Tennessee plant are being built as planned, while we push back SOP for Kentucky Plant No. 2 in light of market conditions and will respond in a flexible manner also in light of volume requirements at Ford. The Hyundai Motor Group JV plant under construction in Bartow County in Georgia is on schedule at this point, but there may be changes in line with EV production plan in Hyundai Motor Group and operational optimization at our production line. We are committed to enhancing investment efficiency to drive financial soundness and optimize profitability, and we'll come back to you with details on annual CapEx plan at the fourth quarter earnings release call. Thank you very much. This is the end of the Q&A session responding to questions that we received in advance. We will now start the live Q&A, and we will switch to consecutive interpretation. Please remember to state your affiliation and name before you ask your question. 지금부터 질의응답을 시작하겠습니다. 질문을 하실 분은 전화기 버튼의 별표와 1번을 누르시기 바랍니다. 질문을 취소하시려면 별표와 2번을 누르시면 됩니다. Now Q&A session will begin. Please press Star one, that is Star and one if you have any questions. Questions will be taken according to the order you have pressed the number Star one. For cancellation, please press Star two, that is Star and two on your phone. 처음으로 질문해 주실 분은 신영증권의 신홍주 님입니다. The first question will be provided by Shin Hongju from Shinyoung Securities. Please go ahead with your question. 네, 안녕하세요. 저는 신영증권 신홍주라고 합니다. 질문 주셔서 감사합니다. 저는 SK E&S 관련해서 두 가지 질문이 있는데요. 첫 번째는 우선 단기, 중장기 글로벌 LNG 시장 전망이랑 그에 따른 저희 E&S 성장 전략에 대해서 공유해 주시면 감사하겠고요. 그리고 두 번째는 저희 SK E&S가 LNG 풀 밸류체인을 보유함으로써 밸류체인 간에 어떤 시너지가 가능할지 좀 궁금합니다. 이상입니다. Yes, thank you for the opportunity to ask questions. There are two questions that I would like to ask you about SK E&S. The first question is that if you look at SK E&S's LNG business, could you share the short-term and also mid-to-long-term forecast or outlook that the company has for LNG, and also what the company's growth strategy would be accordingly? The second question I have is that if you look at the company, it has a presence in the full value chain for LNG, so as a result of that, what type of synergies does the company believe it can enjoy as a result of that? 네, 먼저 첫 번째 질문인 단기와 중장기 글로벌 LNG 시장 전망에 대해서 말씀을 드리겠습니다. 단기적으로는 공급과 수요 측면을 나눠서 볼 수 있는데요. 공급에서는 북미의 신규 LNG 프로젝트 수출이 지연될 가능성이 지금 높기 때문에 추가적인 신규 공급 가능성이 제한적이다라는 요인이 있고요. 수요 측면에서 봤을 때는 유럽의 동절기 이후에 재고 수준이 어느 정도로 유지할 것인가, 그리고 지금 현재 러시아 전쟁에 따른 우크라이나 경유 러시아 파이프라인 가스가 완전 공급이 중단될 예정인데, 거기에 따른 대체 공급 파이프라인을 찾을 수 있을 것인지, 마지막으로 이제 중국의 수요가 어느 정도 수준으로 이제 다시 성장세를 유지할 수 있을지에 대한 여부가 가장 큰 단기적인 LNG 시장의 변동 요인이 되겠습니다. 다음 중장기적으로는 이제 미국하고 이제 중동, 카타르를 중심으로 다수의 신규 프로젝트들이 지금 가동을 준비 중에 있는데요. 장기적으로는 그런 신규 프로젝트들 가동에 따라서 어느 정도 수급 균형이 맞춰질 것으로 전망이 됩니다. 추가로 이제 저희 SK E&S의 성장 전략에 대해서 말씀을 드리자면, 저희 SK E&S는 LNG 밸류체인을 통합 운영하고 있기 때문에 그에 따른 차별화된 경쟁력을 기반으로 2022년 이후부터 매년 1조 이상 영업이익을 창출하고 있고, 올해도 전년과 아마 유사한 수준의 영업이익 창출이 가능할 것으로 예상하고 있고요. 내년에는 앞서 설명드린 바와 같이 3분기 이후에 호주의 CB 가스전, 바로사 가스전이 상업 가동될 예정이기 때문에 거기서의 경쟁력 있는 생산 원가를 기반으로 향후 수익성 측면에서 크게 개선할 것으로 기대하고 있습니다. Yes, let me address the questions that you have asked first with regards to our short to mid-to-long-term global LNG market outlook. In terms of the outlook, I think that if we look at the short-term outlook, I think that we can look at both the supply side and the demand side. In terms of supply, from the North American side, there are new LNG export projects that are looking like they are going to be delayed, so it does seem to be that as a result of that, the additional supply may somewhat be limited in terms of demand. After the winter season in Europe, how much the inventory actually represents and also the going forward outlook in terms of the relationship between Russia and Ukraine also will have an impact because whether the overall Russian gas that flows through Ukraine will be, whether it will be suspended or not, and whether there can actually be alternative pipelines that would be identified as a supply factor would actually also have a determining factor. In addition to that, in China, there also is an expected growth that will be seen in terms of the overall demand, so we do think that for this reason, there may be some volatility in the outlook going forward. Over the mid-to-long term, right now in the US, also in the Middle East, focusing in Qatar, there are many LNG export projects that are planning to go online, so over the mid-to-long-term horizon, we do think that in terms of the supply and demand, there should be a balance that we will be able to see. So in relation to that, maybe to elaborate a bit about our growth strategy, first in terms of integrating the overall energy value chain and operating such, we do think that we have a differentiated competitive edge that we are able to enjoy. So since 2022, if you look at our operating profit, we have been able to achieve a very healthy profit of more than KRW 1 trillion each year, and for this year, again, we do think that our operating profit level will be similar to the previous year. In particular, as mentioned, from the third quarter of next year in Australia, we will see the Barossa gas field go into commercial operations, and as a result of that, we will have a more competitive manufacturing cost base, which will actually contribute significantly to our future profitability. 그리고 러시아-우크라이나 전쟁 이후에 에너지 안보와 가장 현실적인 저탄소 에너지원이라는 이유 때문에 LNG 수요는 지속적으로 증가할 것으로 예상되고 있는 가운데, 당사는 이와 연계해서 LNG 수요 확대 계획을 수립하였고, 용인 반도체 산업단지의 집단 에너지 사업권 확보와 CCS 기술을 적용한 저탄소 LNG 비즈니스의 모델로의 전환을 추진하고 있습니다. 향후에도 SK 이노베이션 E&S 밸류체인 통합 시너지 강화와 신규 사업 등을 통해서 LNG 사업에서의 경쟁력을 지속적으로 확보해 나가겠습니다. After the Russia-Ukraine war is over, because of energy security issues and also because we do think that LNG provides one of the most realistic low-carbon energy sources, we expect LNG demand to continue to grow. So in relation to that overall view, we are setting a plan in which the assumption would be that LNG demand going forward will increase. In addition, in the Yongin Semiconductor Industrial Complex area, we are securing the operating rights for the community energy system there, and by applying CCS technology, we do want to pursue a conversion to a low-carbon LNG business model. So going forward, SK E&S's value chain integration and synergies, by strengthening such and by engaging in new businesses, we do believe that we will be able to continue to secure a competitive edge in the LNG business. 다음 두 번째 질문에 대해 답변드리겠습니다. SK 이노베이션 E&S는 가스전 개발, 즉 업스트림부터 액화 설비, LNG 선박, 터미널 등 미드스트림, 그리고 LNG 발전 사업에 이르는 다운스트림까지 LNG 밸류체인을 통합해서 운영 중에 있습니다. SK 이노베이션 E&S는 이러한 LNG 밸류체인 완성을 통해서 LNG 공급망 전반에 걸친 다양한 제약들을 해소하고 있습니다. Maybe to move on to the second question that you have asked, for SK E&S, we have presence not only on the upstream side, which would be the gas field development, but also on the midstream side, which would be our liquefaction facilities, also our LNG ships and also LNG terminals, and also on the downstream side, which would be the LNG power production facilities that we have. So as a result of that, we have presence and are operating the full value chain in terms of integration across all of the LNG areas. For the company in itself, by completing such LNG value chain, we are able to address various restrictions or constraints that may persist in terms of the full LNG supply chain in itself. 업스트림과 미드스트림 자산을 활용해서 불확실한 대외 환경 속에서도 경쟁력 있는 연료를 안정적으로 공급하고 있고, 소싱 포트폴리오와 LNG 판매처 다변화 등을 통해서 시장 환경에 맞춰서 유연하게 대응하고 있습니다. 향후에도 밸류체인 통합 운영을 통한 시너지를 기반으로 안정적인 이익을 창출해 가도록 하겠습니다. So by utilizing our upstream and midstream assets, even amidst a very uncertain internal and external environment, we are able to supply on a very stable basis competitive fuel, and also through our sourcing portfolio and diversified LNG sales network, we are able to flexibly deal with and address changes in the market environment. Going forward, based upon the synergy that we have across this integrated value chain, we will continue to generate profits very stably. Thank you. 다음으로 질문해 주실 분은 삼성증권의 조현열 님입니다. The following question will be presented by Cho Hyun-ryul from Samsung Securities. Please go ahead with your question. 네, 안녕하세요. 삼성증권 조현열입니다. 질문해 주셔서 감사드립니다. 저는 정유 부문에 대해서 두 가지 질문 여쭙고자 합니다. 첫 번째로는 향후 5년간 글로벌 정제 설비 순증가 규모, 그리고 이에 따른 정유 사업의 수익성 전망에 대해서 말씀해 주시면 감사하겠습니다. 두 번째는 원유 도입인데요. 최근에 캐나다산 원유에 대한 관심이 좀 커지고 있는데, 저희가 북미국이나 캐나다산 원유 수입 비중이 어떻게 되는지가 궁금합니다. 그리고 중동산 대비 북미산 원유 도입 가격 관점에서의 매력이 있는지가 궁금하고요. 향후에 그 비중을 높일 것인지 등 당사의 원유 도입 전략에 대해서 공유해 주시면 감사하겠습니다. 이상입니다. Thank you for taking my question. I am Cho Hyun-ryul from Samsung Securities. I would like to ask you two questions regarding your petroleum business. First question relates to your capacity. If we look out into five years, I would like to understand what the size of your net addition in terms of the capacity is and what impact that will have on your petroleum and refinery business going forward. Second question is in terms of the import of the crude oil. Recently, we've seen an elevated level of interest on the oil coming in from Canada. I would like to understand what the percent of North American sourced crude oil is out of your total portfolio, and compared to the Middle Eastern crude oil, what are the price merits? And also, if you could share with us what your strategies are going forward with regards to the crude oil import, that would be helpful. Thank you. 네, 정유 부분 질문에 대해서 답변드릴 SK 에너지 경영 계획 실장입니다. 먼저 향후 5년간 글로벌 정제 설비의 순증설 규모와 이에 따른 정유 사업 수익성 전망에 대해서 말씀을 드리겠습니다. Hello, thank you for the question. I am Son Seong-cheol, the head of corporate planning office from SK Energy. Responding to your question on our global refining facility capacity for five years to come, I would like to first respond to that question, including the profitability impact it will have. 네, 먼저 29년까지 향후 5년간의 글로벌 정제 설비 순증설 규모는 연평균 25만 BD 수준으로 예상됩니다. Now, first of all, if you look at the upcoming five years, global refining facility net addition, which is up to 2029, we're expecting that to be a per annum average of 250 Kb/d barrels per day. 네, 이 중 25년과 26년은 연평균 53만 BD 순증설이 예상되지만, 이후 글로벌 순증설 규모는 지속적으로 감소할 것으로 전망됩니다. Now, basically, if you just look at year 2025 up to 2026, we're expecting a net addition of, on average, 530 Kb/d barrels per day, but going after that point in time, we expect the size of the global capacity net addition to trend down. 특히 환경 규제의 강화, 그리고 설비 노후화 등으로 인해 폐쇄되는 리파이너리 규모는 지속적으로 증가할 것으로 전망되고 있어 2027년 이후의 순증설 규모는 매우 제한적일 것으로 예상되고 있습니다. Now, we expect that because of more stronger regulation and aging facilities, the total capacity and size of the refinery is going to continuously actually trend up. However, after 2027, afterwards, the net addition is going to be very limited. 2024년에서 2026년까지 연평균 순증설 규모는 글로벌 석유 수요의 약 0.5% 수준일 것으로 추정되고요. 인도를 중심으로 한 글로벌 석유 수요가 연평균 1% 정도 증가할 것으로 예상되는 점을 감안할 때, 시황에 미치는 영향은 제한적일 것으로 판단하고 있습니다. And from 2024 to 2026, we believe that on a per-annual average basis, the net addition size is going to account for about 0.5% of the global petroleum demand, and if you compare that to about, on average, 1% global petroleum demand, which is led by countries like India, we believe that the impact that such net addition capacity will have on the market is going to be limited. 또한 27년 이후부터는 확정된 순증설 프로젝트보다는 폐쇄 예정인 리파이너리 규모가 크기 때문에 양호한 마진 확보가 가능할 것으로 전망하고 있습니다. and post-year 2027, the number of refineries that are slated to be closed down is going to be bigger than the confirmed amount of capacity addition, so we believe that going forward we will be able to secure a favorable level of margin. 네, 이것으로 첫 번째 질문에 대한 답을 마치고, 두 번째 질문을 보면 미국, 캐나다산 원유의 도입 비중을 중심으로 해서 향후 원유 도입 전략, 그리고 중동산 원유 대비 매력이 있는지 여부와, 그리고 그 비중을 어떻게 갖고 갈 것인지에 대한 질문을 해 주셨습니다. 이에 대한 답을 드리겠습니다. Also, moving on to the second question regarding our strategies with regards to sourcing from North American market, including Canada, and what competitive edge or pricing-related attractiveness it has versus the crude oil from the Middle East, as well as our strategy in terms of the percent that we are looking to carry with regards to this North American sourced crude oil, I will respond to that second question. SK 에너지가 원유의 가격, 그리고 운임, 제품 수율 등 정제의 경제성을 결정하는 여러 가지 요인들을 종합 고려했을 때, 현재 시점에서는 중동산 원유 대비 미국과 캐나다산 원유의 경제성이 소폭 우위에 있는 상황이며, 현재 전체 도입 원유 중 약 20%-30% 수준의 미국산 원유를 도입하고 있습니다. So there are multiple factors that SK Energy considers when it analyzes the economics of certain crude oil that we source, and those factors include pricing, freight, as well as production yield, that is. So as of today, if you were to compare the U.S. and Canadian crude included, compared to the Middle Eastern crude, it actually has a little better economics. And out of our total import crude, currently the U.S. crude accounts for about 20%-30% of our total portfolio. 네, 이런 상황을 고려한 당사의 원유 도입 전략은 중동산 중심의 장기 계약 원유를 안정적으로 도입하는 한편, 중동발 지오리스크가 상존하는 상황에서 시황을 면밀히 모니터링해 가며 최대 마진 확보를 위한 최적의 feedstock 포트폴리오를 구성할 수 있도록 공급선 다변화 노력을 지속해서 나갈 계획입니다. 이상입니다. So under this backdrop, we're going to continuously source Middle Eastern crude oil, which are supplied under a long-term contract, but since the region is exposed to geopolitical risk, we will also very closely monitor how things develop. Having said that, our strategy is to make sure that we secure a maximum level of margin and will create our feedstock portfolio that will help us achieve that objective, and that will be supported by diversification of our sourcing. 다음으로 질문해 주실 분은 다이와증권의 정현희 님입니다. The following question will be presented by Jeong Hyun-hee from Daiwa Securities. Please go ahead with your question. 네, 안녕하세요. 다이와증권 정현희입니다. 저도 질문 두 가지 드리고 싶은데요. 첫 번째는 EREV 관련입니다. 최근에 중국에서 EREV 판매 증가하고 있고, 그리고 현대차에서도 출시 계획을 밝힌 바가 있는데, 저희가 EREV 시장을 어떻게 전망하고 계신지, 그리고 고객사랑도 논의하고 계신 부분이 있는지 궁금하고요. 그리고 또 EREV는 배터리 용량이 상대적으로 작은데, 향후 배터리 시장 수급에 부정적으로 영향을 주지 않을까 그런 걱정이 있습니다. 이와 관련된 회사 뷰 공유해 주시면 감사드리겠습니다. 두 번째 질문은 미국 대선 관련인데요. 내일 미국 대선이 예정되어 있어서 시장에서 관심이 많은 것 같습니다. 당사에서 생각하시는 미국 대선 관련한 리스크랑 혹시 대응 방안 같은 거 있으시면 공유 부탁드리겠습니다. 감사합니다. Yes, thank you for the opportunity to ask questions. This is Jeong Hyun-hee from Daiwa Securities, and there are two questions that I would like to ask you. The first question is related to EREV. If you look at right now, the Chinese manufacturers are increasing their EREV sales, and Hyundai Motor also announced plans to launch such a model. So what would be your outlook for the EREV market, and are there any discussions that you currently have with customers ongoing? In addition, I do believe that some believe that because EREVs do represent a smaller battery capacity, that it may have a negative impact on the overall market. So what's the company's view about such a situation? The second question I would like to ask you is about the outcome of the U.S. elections. Of course, we do have U.S. elections taking place tomorrow, and I do think that this is a hot topic of interest for the market. So in relation to the U.S. election-related risks, how is the company accounting for that? 네, Daiwa Securities의 SK IR 담당 Jeong Hyun-hee입니다. 먼저 첫 번째 질문에 대해서 답변드리겠습니다. 말씀하신 대로 최근 EREV에 대한 관심이 높아졌고, 현대차 그룹의 경우 기존 엔진을 활용하면서 배터리 용량을 축소하여 원가 경쟁력을 제고한 EREV 출시 계획을 발표한 바 있습니다. Yes, this is Jung Hyun-wook, and I am from the IR Office of SK On, and maybe I can address the first question. As you have just mentioned, for EREV, there is a lot of increasing interest, and I do think that for Hyundai Motor Group, they have announced their plans to release EREVs, which would be utilizing existing engines and also represent a smaller battery capacity. So with this, they want to strengthen their cost competitiveness. 당사는 현대차 그룹의 주요 벤더 중 하나로서 순수 전기차뿐만 아니라 HEV, PHEV 등에 있어서도 가장 선도적인 포지셔닝을 차지하고 있고, 현대차 그룹의 하이브리드 확대 전략에 따른 수혜도 가장 크게 누릴 수 있는 포지셔닝을 확보하고 있는 것으로 기대하고 있습니다. 이렇게 BEV, PHEV, HEV 또는 EREV 전반에 걸친 협력 관계에 기초하여 이번 EREV형 배터리 대응도 적극적으로 지금 추진 중에 있습니다. So as one of the key vendors for the Hyundai Motor Group, not only for pure electric vehicles but also in terms of HEVs and PHEVs, we do have a leading position within that overall market. So for the Hyundai Motor Group and also the expansion that they are looking for in their hybrid vehicle fleet, we do think that we will be able to secure a position to benefit from such. So we do want to strengthen our competitiveness across the BEV, PHEV, HEV, and EREV portfolio, and as a result of that, we will be actively engaging for EREV-related battery business also. EREV에 대한 관심이 최근 높아진 것은 사실이지만, EREV 자체가 전체 전기차 시장을 주도하거나 순수 전기차를 대체한다고 보기는 어렵고, 실제 일부 시장 조사 기관들도 EREV는 과도기적 기술로서 BEV보다는 오히려 PHEV를 대체하는 것으로 평가하고 있습니다. EREV는 PHEV 용량 이상의 배터리를 탑재하고 있어 배터리 시장에서의 장기적으로 부정적인 영향은 제한적일 것으로 지금 판단하고 있습니다. So with regards to EREV, it is true that there is a lot of interest in this area right now, but we do believe that it will not be a leading driver driving the EV market as a whole, and we don't believe that it will replace pure electric vehicles. If you look at various market research institutions, I do believe that EREV is more regarded as a transitional technology, so rather than for BEVs, it does seem to be somewhat of a replacement for the PHEV market. And as a result of that, if you compare EREVs to PHEVs, EREVs do have a larger battery capacity, so as a result of that, over the longer term, we do think that the negative impact on the battery market would be limited. 다음으로 두 번째 질문에 대해서 답변드리도록 하겠습니다. 트럼프 전 대통령이 만약에 재집권한다고 한 경우, 전기차 보조금 축소와 연비 규제 완화에 따른 전기차 전환의 지연은 불가피할 수는 있습니다만, 실제 IRA로 인한 투자가 공화당 집권주에 집중되어 있다는 점과, 그리고 실제로 공화당 하원의원 18명과 의장이 IRA 폐기 반대 의사를 밝힌 바가 있고, 젊은 공화당원들이 기존 당원들과는 달리 환경 보호에 보다 관심이 많으며, 최근에는 기존 IRA 반대했던 미국 석유 기업들조차 입장을 선회해 트럼프 캠프의 IRA 유지를 요청하는 것으로 알려지는 등 공화당 지지 세력 내부에서도 IRA에 대한 의견이 각기 다른 것으로 파악되고 있습니다. Maybe to address the second question that you have, in the case that former President Trump does get re-elected, I do believe that there could be a reduction in the EV subsidies that are provided and maybe some easing of various emissions-related regulations. So as a result of that, it may be inevitable that the overall EV conversion would slow down. However, it has been said that related to the IRA in itself, if you look at where the investment is taking place, a lot of it is focused on the Republican states. In addition to that, for the lower house, 18 House members and also the head have an objective at making any negative measures towards the IRA. And if you look at the newer generation of Republicans versus the existing or older generations, they seem to be more interested in environment protection. So added to that, a lot of the U.S. major oil companies, which had previously opposed the IRA, are now changing their position and are asking the Trump camp to actually maintain the position on the IRA. So as a result of that, we do think that even within the Republican Party, in terms of the supporters of such parties, with regards to the IRA, there do seem to be some conflicting and different views. 미국 대선 결과 자체를 예상하는 건 더욱더 어렵지만, 이러한 말씀드린 점을 고려하면 IRA에 대해서 부정적인 의견을 표명한 트럼프가 대통령으로 재집권되더라도 IRA 전면 폐지는 어려울 것으로 예상되며, 설령 비우호적인 움직임이 있더라도 전기차 보조금 대상 차량의 축소나 보조금 예산 제한 등 제한적인 조치가 오히려 더 가능성이 높아 보입니다. 당사는 대선 이후 미국 전기차 시장 성장 둔화 가능성에 대비하고 전기차 수요 변동에 대한 손익 변동성을 줄이고자 ESS 등 전기차 외 배터리 애플리케이션 수요를 위한 제품을 개발 중에 있으며, 무엇보다 대선 결과와 관계없이 탈중국 공급망 재편과 보호무역 주의 강화 흐름은 지속될 것으로 판단됨에 따라 미국 내 투자와 현지 시장 능력을 강화하여 중국산 배터리 대비 경쟁 우위를 지속 유지하고자 합니다. So as of the current time, of course, it would be very difficult to make any expectations or forecast on the results of the elections, but even if Trump does win and as a result of that, you know, the camp that had negative views on the IRA, we do believe that the result of that, rather than leading to a full scrap of the IRA in itself, would be resulting in maybe less subsidies for EV vehicles and also maybe some other limitations on the subsidy budget in itself. So we do think that it would be more restrictive in terms of the nature of the results. And as a result of that, in line with a possible slowdown in the U.S. EV market after the U.S. elections, and also to ensure that we lessen the volatility of our overall profits due to the demand situation or cycles in the EV market, we are looking to develop more products for other alternative applications such as ESSs. And in addition, regardless of the outcome of the elections in themselves, we do think that the overall trend of building our supply chains outside of China and also strengthening in terms of trade protection will continue. So as a result of that, we do want to continue to strengthen our production capability on the ground in the U.S. and also continue to enjoy and maintain our competitive edge versus Chinese batteries. 다음으로 질문해 주실 분은 NH투자증권의 최영광 님입니다. The following question will be presented by Choi Young-kwang from NH Investment & Securities. Please go ahead with your question. 네, 안녕하세요. NH투자증권 최영광입니다. 질문 기회 주셔서 감사하고요. 저 두 가지 질문 드리도록 하겠습니다. 우선 저희 정유 설비 가동률이 좀 실질적으로 낮은 것 같은데, 가동률 낮은 배경과 관련해서 저희의 가동 계획 답변 주시면 감사하겠고요. 두 번째는 배터리 관련 질문이고요. 시장에서 유럽의 탄소 배출 규제라든지 이런 전기차 관련 정책 강화로 수요 반등을 내년도에 좀 기대하고 있는데, 회사 내부적으로 수요와 관련해서 좀 어떻게 전망하고 계신지 말씀해 주시면 감사하겠습니다. Thank you. I am Choi Young-kwang from NH Investment & Securities. Thank you for taking my questions. I have two that I would like to ask. The first is that I see that your utilization rate for your refinery facility seems to be on a downward trend. I would like to understand as to the reason why that is and what is your utilization plan for these facilities going forward? Second question relates to your battery business. On the back of strengthening European regulations and more eco-friendly policies being implemented, there is expectation building that there will be a rebound in demand. I would like to understand what the company's forecast and outlook is with regards to demand going forward. 네, 에너지의 경영 규칙입니다. 먼저 첫 번째 정유 부문과 관련돼서 질문 주신 부분에 대해서 답을 드리도록 하겠습니다. Yes, this is Son Seong-cheol from SK Energy, Head of Corporate Planning Office. I will first respond to your question regarding the utilization and run rate of our refinery facilities. 네, 에너지는 3분기 말씀하시는 바와 같이 3분기에는 비우호적인 거시 경제 환경 영향으로 인해 유가 하락과 더불어 제품 시황이 악화됨에 따라 정제 마진이 전분기 대비 하락하였습니다. 당사는 이러한 상황 속에서 3분기에 네거티브 탑핑 마진의 방어, 그리고 고도화 공정 중심의 가동 운영을 위해 CDU 최소 가동 계획을 유지하였습니다. Now, during the third quarter, as you have correctly mentioned, we were in an unfavorable macro backdrop, which drove down the crude oil price, and the overall product market was squeezed and displayed weakness, which ended up in driving down the refining margin. Under this backdrop in Q3, the company continued to maintain a minimum utilization plan for our CDUs so that we can effectively defend against negative topping margin and also so that we can maximize operation of our upgrading processes. 다만 이러한 보수적인 가동 계획 하에서도 시황이 호전됐을 때 마진 개선을 위해 외부의 FOR 투입을 확대하는 운영 전략을 시행 중입니다. 4분기 역시 지속적인 마진 하락 가능성에 대응하여 보수적 운영 계획 하에서 CDU 감량 운영을 계획하고 있습니다. Now, however, under this situation and under a very conservative approach in operating the facilities, we've actually increased the externally sourced FOs, fuel oils, so that we could improve upon our margin once the market starts to show signs of recovery. And in Q4, our CDUs will run at lower levels in case the margin continues to fall and continues to fall. 하지만 시황 변동의 불확실성 하에서 시황을 면밀히 모니터링하고 있고, 이러한 시황 호전 즉시 가동 증량을 검토하는 등 유연하고 기민한 운영 계획을 수립·실행할 계획입니다. Because market uncertainties are persisting, we're very closely monitoring how things develop in the market, and once the market shows signs of recovery, we are going to be quite flexible and agile so that we can immediately increase and respond with increasing utilization. 다음으로 SK온 IR 담당 정현욱이 두 번째 질문 답변드리도록 하겠습니다. Responding to your second question on batteries, I am Jeong Hyun-wook from SK On's IR office. 말씀하신 대로 유럽에서는 탄소 배출 규제가 보다 강화될 것으로 기대되고 있습니다. EU에서 승용차 그리고 상용 차량의 탄소 배출량 규제치를 강화하기로 결정함에 따라 내년 1월 1일부터 차량 제조사별로 신규 등록 차량의 평균 탄소 규제치가 승용차 기준으로는 약 20%가량 강화되게 예정입니다. Now, as you have correctly mentioned, the emissions control and related regulations and rules in Europe are going to strengthen as we go into the future. EU has actually decided to strengthen regulation on CO2 emissions for passenger cars and commercial vehicles starting from January 1st of 2025, and under that changed requirement, the passenger cars will be subject to 20% stringent requirement. 이는 상당히 높은 수준의 감축 요구량으로 현재 유럽의 전동화율이 약 15%인 걸 감안하면 내년 기준으로 순수 전기차만으로 대응했을 때는 약 25%가량 높아져야 한다는 것을 이제 함의하고 있습니다. So this is a very stringent requirement and regulation requirement that is being levied, and considering that the percent of electrification in EU is about 15%, if they were only to respond with purely EVs, that means that the requirement would have to be further beefed up to 25% level. 따라서 해당 규제의 시행으로 전기차 비중 확대가 도움이 된다고 이제 볼 수는 있습니다만, 동시에 최근 유럽 OEM사들의 경우 규제 기관을 대상으로 규제 완화를 요구하는 움직임을 보이기도 하고 있고, 다른 제조사와 탄소 크레딧 풀링 계약을 맺는 등의 움직임을 준비하고 있어 지속적인 모니터링이 필요하고, 더욱이 유럽의 매크로 환경이 어떻게 전개될지는 좀 더 지켜봐야 되기 때문에 이 배출 규제에 따른 구체적인 영향을 현 시점에서 예측하기는 쉽지는 않습니다. If you were to think about this type of regulation coming into place and if we were looking at the percent of purely EVs that exist in the European market, it may help with further expanding the EV penetration in Europe. Having said that, at this point, we hear that many OEMs are currently talking to European regulatory authorities demanding for a mitigation or the easing of the applied regulations. And also, there are moves that these OEMs are coming together to employ a carbon CO2 emission pooling schemes and plans. We hence need to wait and see how the macro environment in Europe actually plays out as we go into the future. And so at this point in time, it will be quite difficult for us to share with you any specific implication what these regulatory environment has on our business. 당사 역시 규제에 대응하기 위한 고객사들의 니즈를 고려하여 25년 유럽 공급량에 대해 고객사들과 긴밀히 협의 중에 있습니다. 아직 진행 중이고 구체적인 내용은 확정되지는 않았습니다. 이상입니다. SK On, we are also in close talks with our customers regarding your 2025 supply volume, but they are yet to be decided, and so no details have yet been confirmed. Thank you. 시간 관계상 마지막으로 질문해 주실 분은 하나증권의 윤재성 님입니다. The last question will be presented by Yoon Jae-sung from Hana Securities. Please go ahead with your question. 윤재성 님, 질문해 주십시오. 네, 안녕하세요. 하나증권 윤재성입니다. 질문 기회 감사합니다. 두 가지 질문 드리겠습니다. 일단 첫 번째는 최근에 정유 업황을 보면 미국이나 중국, 인도 같은 경우는 코로나 이전 대비해서 순수출량이 감소한 것 같습니다. 근데 이번에 3분기 누적으로 한국의 정유 수출량은 사상 최대치를 기록했다는 뉴스가 있었던 것 같습니다. SK에너지도 이러한 한국의 수출 트렌드를 따라가고 있는지 궁금하고요. 최근에 수출 현황이 궁금하고요. 그리고 앞서서 추가적으로 가동률 상승 여력이 있다라고 하셨는데, 향후에 저희가 가동률을 올리게 되면 어느 쪽, 어느 지역으로 추가적인 물량을 판매할 수 있는 기회가 포착될 수 있는지 말씀 부탁드리고요. 두 번째는 SK 어스온 같은 경우 중국 신규 광구가 돌아갔는데 현재 가동률이나 생산 현황이 궁금하고요. 2025년도에 추가적인 외형 성장을 기대할 수 있는 포인트가 어떤 게 있는지 궁금합니다. Yes, thank you for the opportunity to ask questions. There are two questions that I would like to ask you. First, if you look at the petroleum market in general, it seems to be that in the U.S., China, and also India, when compared to pre-COVID levels in terms of the net exports from these regions, it seems to be less. However, I have seen news reports that in the case of Korea, in terms of the third quarter YTD numbers, that exports have reached an all-time high. So in terms of the overall trends that we see in Korea, is SK Innovation following these trends? And if so, you also mentioned that there is the possibility that utilization would be increased further. Then where do you actually believe this additional volume could be sold to in terms of the overall region? The second question that I would like to ask you is about your SK Eartho n business. There is new capacity going online in China in terms of the production and utilization there. What is the current status? And in terms of 2025, if there are any elements that you believe would contribute to a higher top line for 2025, we would like to understand what that is. 네, 먼저 정유 부문의 질문에 답을 드릴 에너지 경영 계획실장입니다. 먼저 최근 3분기 누적으로 국내 수출량이 사상 최대치를 기록한 점, 그리고 향후에 수출량 추이 및 회사의 증가 업사에 대해서 질문을 주셨습니다. 이 부분에 대해서 설명을 드리겠습니다. Yes, this is the head of the corporate planning office at SK Energy, and maybe I could address your first question, which was talking about the 3Q YTD numbers in terms of reaching a historic high in terms of exports from Korea and also whether there would be any potential upside that we would be able to see going forward. 네, 한국 전체를 에너지가 설명을 드리기에는 정확하지 않을 수도 있지만, 조금 전에 에너지의 가동 운영 계획을 따르면 에너지의 경우는 수출 물량이 감소했습니다. 다만 타 정유 3사의 경우는 탐문에 의하면 가동량을 시황에 따라 조정하지 않고 80%-90% 수준으로 유지하고 있는 것으로 탐문이 되었습니다. 이를 고려했을 때 한국 전체적으로는 가동량을 크게 줄이지 않는 것으로 탐문되고, 이에 따른 수출 증가가 이루어진 것으로 예상됩니다. So in terms of explaining Korea as a whole in terms of the market, you know, just from SK Energy, whether this would be fully accurate or not is something that we're a bit cautious about, but maybe just to talk about it from the company's standpoint. If we look at our overall utilization plans, in terms of our exports, we actually did not see an increase. There was a decrease in the overall level. However, if we look at the three other petroleum companies in Korea, as far as we understand, based upon our market intelligence, it does not seem to be that they have adjusted their utilization according to the market backdrop, but have been maintaining utilization at around 80%-90%. So in light of this fact, it seems to be that for Korea as a whole, utilization of existing facilities did not decrease, and as a result of that, exports for the country as a whole have increased because of such a factor. 네, 그리고 조금 전에도 말씀드렸듯이 시황이 개선될 경우 에너지의 경우는 가동량을 증량할 계획을 수립하고 있습니다. 최근 10월부터 전반적인 시황이 개선되고 있음을 확인하고 있습니다. 특히 유럽과 중동의 전기 보다 피크 시즌과 맞물려서 시황이 반전되고 있고, 이러한 상황을 고려해서 당사의 경우도 가동량을 개선할 준비를 하고 있습니다. 특히 저희의 경우는 운임 경쟁력을 확보할 수 있는 동남아시아 그리고 호주 산으로의 수출 물량을 증대할 계획입니다. 이상입니다. So as mentioned before, in terms of the overall market situation, we do see an improvement there, and accordingly, we are planning to increase the overall production volume at the company level. So if you look at the overall market situation in October, we did actually see signs of a recovering market across the board. And in addition to that, going into the peak turnaround season in the Middle East and also in Europe, we do think will add to a rebound within the market. So we are being prepared to run our utilization at a higher level, and in particular, in terms of the markets that we're trying to address, we want to look at the markets in which we think are most competitive for us in terms of the overall freight rates that we have. So right now, we are planning to increase our exports to the Southeast Asian and also Australian markets. I am the head of the planning department at SK Earthon. The E&P business is producing 57,000 barrels per day from 5 production blocks including Peru, China, Vietnam, etc. The oil proportion is 40%. This is SK Eartho n, and maybe I can address your question. Right now, if you look at the production sites that we have, there are five different sites in the locations, including Peru and Vietnam. If you look at the overall production volume in terms of the number of barrels per day, it's 57,000, of which 40% would be oil. 지난해 생산을 개시한 중국 1703 블록의 경우는 10월 평균 그로스로 하루 2만 7천 배럴을 생산 중에 있습니다. If you look at the China 17/03 block, which started production last year in terms of October, in terms of daily production, it was 27,000 barrels. 내년도에 추가 외형 성장에 대해서 말씀을 드리면, 중국 1703 생산장에 대해서 추가 생산정 시추 계획을 가지고 있으며, 계획대로 진행된다면 2분기 중에 물량 상승이 기대됩니다. To talk about additional production for next year, in terms of the China 17/03, we do have plans to drill additional production wells, and if that does come in, we do think that there will be an increase in production in the second quarter of next year. 또한 현재 베트남 Vietnam 15-1/05 광구에서.