National Pension Service, Korea’s biggest investor, may set up a private equity fund with the nation’s business groups, including Samsung Group and Hyundai Motor Group, to invest in overseas resource development.
SK Group, GS Group and KT Corp. may also join the plan, Kim Seok-joo, a spokesman for the pension fund, said by phone Tuesday. The timing and size of the fund have yet to be decided, he said.
“We may sign a preliminary agreement with major companies to invest in energy resources,” said Kim, whose pension fund manages 317 trillion won ($282 billion) in assets.
Korea, Asia’s fourth-largest crude importer, has said it aims to boost supplies of oil and gas from overseas resources owned by the nation’s companies to 30 percent of its annual requirements by 2019 from 9 percent in 2009.
National Pension said in October it bought a stake in Colonial Pipeline Co., operator of the largest pipeline linking U.S. Gulf Coast refiners and East Coast markets, to diversify its portfolio. In September, state-owned Korea National Oil Corp. also won control over Dana Petroleum Plc in a 1.87 billion-pound ($2.9 billion) hostile takeover.
Funds are increasing their investments in resources as energy costs rise. Hedge funds raised bullish bets on crude oil to the highest level in more than four years on speculation that futures will climb as the U.S. recovers from the deepest recession since the 1930s.
The funds and other large speculators increased net-long positions, or wagers on rising prices, by 4.6 percent in the seven days ended Dec. 28, according to the Commodity Futures Trading Commission’s weekly Commitments of Traders report. It was the top total in records going back to June 2006.