ID :
38950
Mon, 01/05/2009 - 18:54
Auther :
Shortlink :
http://m.oananews.org//node/38950
The shortlink copeid
S. Korea to invest US$7 bln in energy development in 2009
(ATTN: UPDATES with more details, comments from para 3)
SEOUL, Jan. 5 (Yonhap) -- South Korean companies are planning to increase
overseas investment in energy development projects this year by over 20 percent
despite ongoing financial instability and a rapid economic downturn, the
government said Monday.
According to the Ministry of Knowledge Economy, around $7 billion is expected to
be invested in developing energy sources this year, up 22.8 percent from the $5.7
billion spent last year.
Of the total, $5.2 billion will be spent on oil and gas energy development
projects with $1.8 billion to be invested in developing major mineral resources
including copper and coal, according to the ministry.
The sharp increase is due to a general consensus among local firms that the
current financial climate -- which is marked by instability and a slew of
economic challenges -- provides a ripe opportunity for investment, the ministry
said.
The increase in investment will raise South Korea's self-sufficiency in oil and
gas to 7.4 percent of domestic demand, or 225,000 barrels per day, within the
year. The figure reflects a significant increase from the 5.7 percent of demand
tallied for 2008 when the country used up 172,000 barrels per day on average, the
ministry said.
In addition to more exploration and development, the plan calls for the
purchasing of a South American oil company that is capable of producing at least
10,000 barrels per day to greatly increase output by local companies.
Without going into detail, the ministry said it will have gathered the funding to
buy such a company within the first half.
In the longer term, state-owned Korea National Oil Corp. (KNOC) -- which produces
50,000 barrels per day -- may move to buy a company that has up to four times
that output.
"We are currently looking at seven to eight oil producers that can pump out
200,000 barrel per day, but depending on various conditions, KNOC may opt to buy
a smaller company," said Vice Knowledge Economy Minister Lee Jae-hoon.
To facilitate the investments, the official said that it will provide diverse
financial support to companies through state-run financial institutions.
He added that as part of a ministry effort to purchase stakes in overseas oil
fields, Seoul may provide drill ships and high-tech, floating production storage
and offloading (FPSO) vessels to oil-producing countries. FPSO vessels produced
by local shipyards cost more than $1 billion a piece and are essential for
deep-water, offshore operations.
South Korea makes most of the drill ships in operation today and controls 40
percent of the FPSO market.
"Brazil which is trying to develop offshore as well and has brought up such a
plan, and talks are underway with related industries to examine feasibility," Lee
said.
The report, meanwhile, showed South Korea secured a total of 71 energy
development projects worldwide in 2008 through joint efforts with other nations,
according to the ministry.
(END)
SEOUL, Jan. 5 (Yonhap) -- South Korean companies are planning to increase
overseas investment in energy development projects this year by over 20 percent
despite ongoing financial instability and a rapid economic downturn, the
government said Monday.
According to the Ministry of Knowledge Economy, around $7 billion is expected to
be invested in developing energy sources this year, up 22.8 percent from the $5.7
billion spent last year.
Of the total, $5.2 billion will be spent on oil and gas energy development
projects with $1.8 billion to be invested in developing major mineral resources
including copper and coal, according to the ministry.
The sharp increase is due to a general consensus among local firms that the
current financial climate -- which is marked by instability and a slew of
economic challenges -- provides a ripe opportunity for investment, the ministry
said.
The increase in investment will raise South Korea's self-sufficiency in oil and
gas to 7.4 percent of domestic demand, or 225,000 barrels per day, within the
year. The figure reflects a significant increase from the 5.7 percent of demand
tallied for 2008 when the country used up 172,000 barrels per day on average, the
ministry said.
In addition to more exploration and development, the plan calls for the
purchasing of a South American oil company that is capable of producing at least
10,000 barrels per day to greatly increase output by local companies.
Without going into detail, the ministry said it will have gathered the funding to
buy such a company within the first half.
In the longer term, state-owned Korea National Oil Corp. (KNOC) -- which produces
50,000 barrels per day -- may move to buy a company that has up to four times
that output.
"We are currently looking at seven to eight oil producers that can pump out
200,000 barrel per day, but depending on various conditions, KNOC may opt to buy
a smaller company," said Vice Knowledge Economy Minister Lee Jae-hoon.
To facilitate the investments, the official said that it will provide diverse
financial support to companies through state-run financial institutions.
He added that as part of a ministry effort to purchase stakes in overseas oil
fields, Seoul may provide drill ships and high-tech, floating production storage
and offloading (FPSO) vessels to oil-producing countries. FPSO vessels produced
by local shipyards cost more than $1 billion a piece and are essential for
deep-water, offshore operations.
South Korea makes most of the drill ships in operation today and controls 40
percent of the FPSO market.
"Brazil which is trying to develop offshore as well and has brought up such a
plan, and talks are underway with related industries to examine feasibility," Lee
said.
The report, meanwhile, showed South Korea secured a total of 71 energy
development projects worldwide in 2008 through joint efforts with other nations,
according to the ministry.
(END)
