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Korea imported no oil, gas from its foreign fields
By Korea HeraldPublished : April 15, 2012 - 20:20
South Korea has imported no oil or natural gas from any of the overseas fields it controls, despite having poured a total of 16 trillion won ($14.1 billion) to secure these assets, the country’s audit and inspection agency said Saturday.
The Board of Audit and Inspection announced, after reviewing the status of 17 overseas crude and gas production operations up till July 2011, that the country imported no fossil fuel resources from any of these fields.
It said that of the 17, only two located in Britain had clauses that would permit the resource to be shipped to South Korea if the need arises, with the rest having no such provisions.
The fields inspected were either fully or partly owned by state-run Korea National Oil Corp. and Korea Gas Corp.
The BAI said in the case of one field in the United States that the KNOC has a 80 percent stake in, the fossil fuel can only be shipped to South Korea after getting permission from the U.S. government.
It said of the four gas wells checked in which KOGAS has investments, the South Korean company’s stake in three were too small to allow it to have a voice in where the resource could be shipped.
“In most cases, there is very little likelihood of oil and gas from these field being shipped directly to South Korea,” the watchdog said. It pointed out that because of such restrictions, the overseas fields are unable to positively affect the steady rise in domestic petroleum product prices.
The BAI said it ordered the Ministry of Knowledge Economy, which oversees the country’s industrial and energy policies, to create a new index that can better show the country’s real self-sufficiency rate in oil and gas, based on actual resources it can bring in.
At present, the self-sufficiency rate is calculated as the total output of resources produced by fields in which local energy companies have investments.
The watchdog also called on authorities to reprimand KNOC employees responsible for buying Calgary-based Harvest Energy in 2009 for well above its true value. The purchase cost the KNOC paid was 4.5 trillion won, which is 74.1 billion won more than the actual worth of Harvest’s assets, the BAI said. (Yonhap News)
The Board of Audit and Inspection announced, after reviewing the status of 17 overseas crude and gas production operations up till July 2011, that the country imported no fossil fuel resources from any of these fields.
It said that of the 17, only two located in Britain had clauses that would permit the resource to be shipped to South Korea if the need arises, with the rest having no such provisions.
The fields inspected were either fully or partly owned by state-run Korea National Oil Corp. and Korea Gas Corp.
The BAI said in the case of one field in the United States that the KNOC has a 80 percent stake in, the fossil fuel can only be shipped to South Korea after getting permission from the U.S. government.
It said of the four gas wells checked in which KOGAS has investments, the South Korean company’s stake in three were too small to allow it to have a voice in where the resource could be shipped.
“In most cases, there is very little likelihood of oil and gas from these field being shipped directly to South Korea,” the watchdog said. It pointed out that because of such restrictions, the overseas fields are unable to positively affect the steady rise in domestic petroleum product prices.
The BAI said it ordered the Ministry of Knowledge Economy, which oversees the country’s industrial and energy policies, to create a new index that can better show the country’s real self-sufficiency rate in oil and gas, based on actual resources it can bring in.
At present, the self-sufficiency rate is calculated as the total output of resources produced by fields in which local energy companies have investments.
The watchdog also called on authorities to reprimand KNOC employees responsible for buying Calgary-based Harvest Energy in 2009 for well above its true value. The purchase cost the KNOC paid was 4.5 trillion won, which is 74.1 billion won more than the actual worth of Harvest’s assets, the BAI said. (Yonhap News)
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Articles by Korea Herald
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