Korea National Oil Corp., a state-run energy resources developer, plans to invest as much as $4 billion in overseas oilfields this year as it aims to increase crude production by 33 percent.
“We’re interested in assets in Africa, Europe, Asia, the U.S. and Canada,” Kim Seong Hoon, senior executive vice president, said in an interview. “We plan to raise daily output by 60,000 barrels to 240,000 barrels by the end of the year.”
The company known as KNOC invested about $3 billion in overseas assets last year. Chief Executive Officer Kang Young Won said in October he will focus on investing in producing fields rather than buying companies, after completing its hostile takeover of Scotland’ Dana Petroleum Plc.
The company bought a 50 percent stake in Petro-Tech Peruana SA of Peru, now known as Savia Peru, for $450 million in February in 2009 and purchased Canada’s Harvest Energy Trust worth $3.9 billion eight months later.
“There will be no more acquisitions of listed companies because the process is too complicated,” Kim, 55, said yesterday at the company’s headquarters in Anyang near Seoul. “We will spend between $3 billion and $4 billion this year.”
The government of South Korea, which imports almost all its oil and gas needs, said in 2008 it will spend 19 trillion won ($17 billion) to boost Korea National Oil’s overseas production sixfold by 2012 and it will sell shares in the state-run company after achieving that goal.
The government may sell a stake in Korea National Oil in an initial public offering in 2015, Kim said.
The company needs to increase its daily crude oil output to 300,000 barrels by 2012 to meet the energy needs of Asia’s fourth-biggest economy. The company’s daily output was 50,000 barrels in 2008.
Recent gains in crude may inflate asset prices, Kim said. New York crude futures rose to the highest since October 2008 on Jan. 31 because of concerns the unrest in Egypt will spread to oil exporters such as Saudi Arabia and disrupt supplies from the Middle East.
London-traded Brent has closed higher than $100 a barrel for five of the last eight days through to yesterday. It was quoted at $102.04 at 9:16 a.m. Singapore time today.
Korea National Oil is not interested in the North Sea fields that Exxon Mobil Corp. is trying to sell, Kim said. The largest U.S. oil company is seeking to sell stakes held by subsidiary XTO in some North Sea blocks off the U.K. coast. Exxon Mobil is offering its 15 percent stake in blocks that include the Platypus natural-gas discovery, operated by Dana Petroleum.
