South Korea Oil and Gas Report Q1 2013
Business Monitor International, January 2013, Pages: 83
BMI View:
While there are new efforts to stimulate upstream oil and gas activity and improve energy self-sufficiency, there is little to suggest that South Korea can develop significant resources, meaning the country is set to remain a key importer of crude and natural gas in liquefied form. Meanwhile, the government is planning fresh initiatives aimed at reducing oil consumption, while the state gas industry continues to buy into overseas LNG schemes to meet growing demand.
The main trends and developments we highlight for the South Korean Oil & Gas sector are:
- The extension of a contract between France's GDF Suez and Korea Gas Corporation (Kogas)
is a positive development in securing supply from a stable source for the world's second largest importer of liquefied natural gas (LNG). With pipelines untenable due to hostile relations with the North, imports of LNG are critical to powering the country's economy.
- The economy relied on oil for an estimated 40.0% of its energy needs in 2010, and while this figure is expected to have declined to 37.5% in 2012, the government aims to reduce it further to 33.0% by 2015. This would enable the country to shave oil consumption by 26mn barrels in three years. Given that the country imports almost all of its oil, volatility in oil prices stands to be a perennial problem for the economy. The government-led energy savings drive introduced in May 2012 had a strong focus on the transport sector, which accounts for 32.7% of all oil used.
Plans are being drafted to raise fuel efficiency guidelines to amongst the best in the world by 2025. Our oil demand growth assumptions are cautious, averaging less than 0.5% per annum through to 2017, before stagnating as fuel substitution and energy-saving measures slow consumption growth. BMI is forecasting oil consumption of 2.26mn barrels per day (b/d) by 2017, compared with an assumed 2.23mn b/d in 2012. South Korean net oil imports are set to remain at around 2.21-2.24mn b/d over the next five years, costing an estimated US$80.2bn in 2013 and falling to US$76.4bn by 2017. At the time of writing we assume an OPEC basket oil price for 2012 of US$107.05/bbl, falling to US$99.10/bbl in 2013.
- Gas net import costs of US$27.7bn are forecast for 2017, rising to US$29.2bn by 2021.
Combined with oil import expenses, total petroleum costs are put at US$104.1bn in 2017 and US$103.9bn in 2021.
BMI Industry View 5
SWOT Analysis 6
South Korea Oil and Gas SWOT 6
Industry Forecast Scenario 7
Oil And Gas Reserves 7
Table: South Korea - Proven Oil and Gas Reserves & Total Petroleum Data, 2011-2017 7
Table: South Korea - Proven Oil and Gas Reserves & Total Petroleum Data, 2015-2021 8
Oil Supply And Demand 10
Table: South Korea - Oil Production, Consumption and Net Exports, 2011-2017 10
Table: South Korea - Oil Production, Consumption and Net Exports, 2015-2021 11
Gas Supply And Demand 13
Table: South Korea - Gas Production, Consumption and Net Exports, 2011-2017 13
Table: South Korea - Gas Production, Consumption and Net Exports, 2015-2021 14
LNG 17
Refining And Oil Products Trade 17
Table: Refining - Production and Consumption, 2011-2017 17
Table: Refining - Production and Consumption, 2015-2021 18
Revenues/Import Costs 19
Key Risks To BMI's Forecast Scenario 20
Oil And Gas Infrastructure 21
Oil Refineries 21
Table: Refineries In South Korea 21
Service Stations 21
Oil Storage 21
LNG Terminals 22
Table: LNG Terminals In South Korea 22
Gas Storage 22
Gas Pipelines 23
South Korea Upstream Rating - Overview 24
South Korea Upstream Rating - Rewards 24
South Korea Upstream Rating - Risks 24
South Korea Downstream Rating - Overview 24
Regional And Country Risk/Reward Ratings 25
Table: Asia's Oil & Gas Risk/Rewards Ratings 25
Table: Asia Upstream Risk/Reward Ratings 31
Table: Asia Downstream Risk/Reward Ratings 32
Competitive Landscape 33
Executive Summary 33
Table: Key Players - South Korean Oil And Gas Sector 33
Overview/State Role 34
Government Policy 34
International Energy Relations 37
Table: Key Upstream Player 40
Table: Key Downstream Players 40
Company Monitor 41
Korea National Oil Corporation (KNOC) 41
Korea Gas (Kogas) 44
SK Innovation 47
GS Caltex - Summary 49
S-Oil - Summary 49
Hyundai Oilbank - Summary 49
Woodside Petroleum - Summary 50
POSCO - Summary 50
Daewoo International - Summary 51
Regional Energy Market Outlook 52
Table: Number Of Rigs In Operation In Asia 53
Global Energy Market Outlook 59
Table: Global Oil Demand Forecasts - A Comparison 62
Asia - Regional Appendix 65
Table: Oil Consumption - Historical Data & Forecasts, 2009-2016 ('000b/d) 65
Table: Oil Consumption - Long-Term Forecasts, 2014-2021 ('000b/d) 65
Table: Oil Production - Historical Data & Forecasts, 2009-2016 ('000b/d) 66
Table: Oil Production - Long-Term Forecasts, 2014-2021 ('000b/d) 67
Table: Refining Capacity - Historical Data & Forecasts, 2009-2016 ('000b/d) 68
Table: Refining Capacity - Long-Term Forecasts, 2014-2021 ('000b/d) 68
Table: Gas Production - Historical Data & Forecasts, 2009-2016 (bcm) 69
Table: Gas Production - Long-Term Forecasts, 2014-2021 (bcm) 70
Table: Gas Consumption - Historical Data & Forecasts, 2009-2016 (bcm) 70
Table: Gas Consumption - Long-Term Forecasts, 2014-2021 (bcm) 71
Table: LNG Exports - Historical Data & Forecasts, 2009-2016 (bcm) 72
Table: Net LNG Exports - Long-Term Forecasts, 2014-2021 (bcm) 72
Methodology And Risks To Forecasts 73
Glossary Of Terms 74
Table: Glossary of Terms 74
Oil And Gas Risk/Reward Ratings Methodology 76
Ratings Overview 76
Table: BMI's Oil & Gas Business Environment Ratings - Structure 77
Indicators 77
Table: BMI's Oil & Gas Upstream Ratings - Methodology 77
Table: BMI's Oil & Gas Business Environment Downstream Ratings - Methodology 79
BMI Methodology 81
How We Generate Our Industry Forecasts 81
Energy Industry 81
Cross checks 82
Sources 82
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