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2006-03-12006.3.410:47AM페이지18001채널맥(3443-0701)
New Growth Engine / Energy
MOCIE Focuses on Energy
Creation as New Growth Engine
Reform of Korea National Oil Corporation high on the agenda
Lee Won-gul,
vice minister of the MOCIE
The Ministry of Commerce, Industry and
Energy (MOCIE) will place the focus of its
energy policy for 2006 on energy creation
as a new growth engine, Lee Won-gul, vice minister
of the MOCIE, said recently.
“In 2006, the ministry will firm up its base to
expand the energy supply capacity on a stabilized
basis, while promoting the public functionality
of energy,’ said the vice minister in an
interview with the Korea IT Times.
The ministry will map out the third electric
power supply and demand basic plan, which
includes the implementation of a contract to
introduce LNG on a long-term basis after 10
years and the setup of a long-term plan for the
coal industry.
Along with this, the ministry will activate
development of overseas resources by pushing
for revision of the Korea Petroleum Corporation
Act in such a way as to actively foster enterprises exclusively
dealing with resources development and introducing the oil field
development fund amounting to 200 billion won, he said.
“At the same time, we will strive to create a new growth engine
in the energy sector through active fostering of the market-friendly
energy saving industry and the new and renewable energy industry,
advancement into overseas markets by the domestic energy industry
and expansion of R&D investment,” said the vice minister.
Also, the government plans to strengthen public function by
enhancing equality of the energy service for the low-income
bracket.
Asked about the government’s measures to tide over the era of
high oil prices, Vice Minister Lee said, “In the past two years,
international crude oil prices structurally upgraded by one step
under the pressure of a rising demand for oil amid the favorable
global economy and restrictions on oil producing countries’ ability
for surplus supply,” said Lee.
“Entering this year, the global oil prices continue rising, affected
by Iran’s nuclear development issue and
Nigeria’s unstable oil supply in the wake of
recent unrest,” he said.
As of Feb. 1, 2006, international oil prices hit
a record high with the Dubai oil reaching $61.1
per barrel. The average oil price between Jan. 1
and Feb. 21 this year stood at $58.22 per barrel,
up 51.6% from a year earlier and up 8.8% from
the end of last year.
“To effectively cope with the recent high oil
prices, the government will exert all-out efforts
to secure energy and resources stably through
expansion of development of overseas
resources,” Lee said.
“The government will also seek ways to
improve efficiency of energy use and bolster its
energy-saving policy, while striving to develop
future energy, including new and renewable
energy,” he said.
Along with this, the ministry will enhance its ability to cope
with possible crises, including worsening of the Iranian nuclear
issue, by expanding its oil storage for emergency.
As part of its efforts to save more energy, the ministry will
encourage people to participate in the energy saving campaign
voluntarily, while accelerating the conversion into an energy low
consumption society on a mid- and long-term basis.
In case self-regulatory steps reach a limit owing to an abnormal
surge in oil prices, the government will seriously consider
employing a compulsory energy saving measures on a step-bystep
basis, he said.
Commenting that Korea depends for 97% of the energy it uses
on foreign countries, Vice Minister Lee stressed the necessity of
securing energy stably.
“In line with this, the government has set development of overseas
resources as a national agenda and has been pushing ahead
with proper measures through hosting of national energy consultation
meetings, which are presided over by the president,” he said.
The following are excerpts from an interview with Lee
Won-gul, vice minister of the MOCIE:
Q: Would you comment on the Ministry of
Commerce, Industry and Energy’s plan to expand supply
of new and renewable energy?
A: In preparation for continuation of high oil prices and
regulations on international environment, the government will
make policy efforts, including allotment of enough budgets for
development and supply of new and renewable energy.
The ministry plans to expand the portion of new and renewable
energy to primary energy to
the 5% level of advanced countries
by 2011, he said. In 2001,
the supply ratio of new and
renewable energy was 7% in
France, 4.3% in the United
States, 3.0% in Japan and 2.2%
in South Korea (in 2005).
Q: Global societies are
making jointed efforts to tide
over an era of high oil prices.
What is the meaning of the international cooperation?
And what is the role and future plan of Korea?
A: Recently, uncertainties are continuing in the international
energy market owing to political instability in the Middle
East region and a surge in demands for oil by developing countries,
including China.
Resource-rich countries need massive amounts of money
and time to develop and produce resources, whereas resource
consumption countries are staging stiff competition to secure
enough resources, resulting in uneasiness in the supply of oil.
Korea’s development activities of overseas
resources dampened temporarily right
after the 1997-1998 Asian financial crisis,
but the results of the government’s such
efforts have been visualized thanks to summit
diplomacy and enterprises’ strategic
participation in the overseas resources
development project.
Korea’s investment in oil field development
continued to rise from $340 million
in 2001 to $590 million in 2003, $670 million
in 2004, and again to $800 million in
2005.
Accordingly, the nation’s self development
ratio of crude oil went up from 2.0%
in 2001 to 3.0% in 2003, 3.8% in 2004, and
further to 4.1% in 2005.
“Under the basic plan to privatize
affiliates of KEPCO, the
government selected KOSEP as the
first target for privatization and
tried to do so.”
Accordingly, to jointly cope with energy crisis and
strengthen energy security, oil producing and consuming
countries are required to seek energy cooperation for mutual
survival, said Vice Minister Lee.
Q: Would you introduce the government’s plan for
privatization of Korea South-East Power Co. (KOSEP),
an affiliate of Korea Electric Power Corp. (KEPCO)?
Do you have any idea for privatization of other KEPCO
subsidiaries?
A: Under the basic plan to privatize affiliates of KEPCO,
the government selected
KOSEP as the first target for
privatization and tried to do so.
However, the sell-off of the
managerial right of KOSEP
was suspended temporarily
owing to nonattendance of
final bidders, including
POSCO, SK and J-Power, in
the bidding.
As a second step, the government
attempted to list
shares of KOSEP on the stock market, but failed as the anticipating
public subscription price fell far behind the book value.
As a result, the ministry plans to concentrate its energy on
enhancing the corporate value of KOSEP, while pushing for
listing of its shares on the stock market at a proper time in the
near future.
As for privatization of other KEPCO subsidiaries, the ministry
is planning to map out various measures for privatization
suitable for market conditions in the future.
In particular, the nation attained tangible
results in oil exploration projects in
Nigeria and Vietnam last year, following
Russia and Kazakhstan, thanks to President
Roh Moo-hyun’s summit diplomacy, he
said.
As a means of expanding such favorable
results for development of overseas
resources, the government will continue
bolstering resource diplomacy by strategic
region, while pursuing expansion of
diverse financial resources for oil exploration
projects and strengthening of public
and private companies’ ability to develop
overseas resources.
In particular, it will analyze main factors
for successful advancement into overseas
markets by the domestic energy industry
and make the best use of the analyzed
results, setting them as model cases for
Korean-style development of overseas
resources.
Besides, the ministry will use private
financial sources through introduction of
oil field development funds and actively
foster private enterprises specialized in
development of overseas resources through
expansion of infrastructures such as R&D
and manpower.
Along with this, the government will
make a strong push for reform of Korea
National Oil Corporation gradually for
effective management.
1 8 _ March 2006 KOREA IT TIMES
KOREA IT TIMES March 2006 _ 1 9