ABU DHABI: South Korea is importing about 100 million barrels of crude oil every year from the UAE and the drop in oil prices has been benefiting the country, Ambassador of the Republic of Korea told Gulf News.
“The low oil prices gave Korean economy some boost and we are paying less than in the past in importing oil. Two years ago oil was expensive but nowadays it has gone down my more than half,” said Kwon Hae-Ryong.
“The country is benefiting from the low oil prices but there is also concern among Korean companies that some energy projects may be cancelled or delayed as oil producing countries spend less due to low oil prices.”
Oil prices have fallen by more than 70 per cent since 2014 as production outpaces demand. From more than $110 per barrel, oil prices plunged to less than $30 per barrel in recent times. Companies worldwide have cancelled projects and cut spending as low oil prices hurt them financially.
The Energy Ministers in the Gulf countries said that investment in the energy sector will continue despite low oil prices. The investment of Korean companies in the energy sector is increasing in the UAE, Ambassador said.
Last year the UAE government awarded 3 per cent stake to GS Energy as part of Abu Dhabi concessions to develop onshore oilfields, which produce 1.6 million barrels of oil per day and have a target of 1.7 million from 2017.
Korea National Oil Corporation is going to develop crude oil production facilities in different fields in Abu Dhabi. Meanwhile, a number of Korean companies have been supporting the UAE as part of their corporate social responsibility in the fields of education, community development and research projects.
LG Electronics has joined hands with Sharjah City for Humanitarian Services to develop mobile applications for persons with disabilities while Samsung is working with Al Noor Center for children with special needs.
KNOC is working with Petroleum Institute in Abu Dhabi in offering engineering degrees and funding research and development in cooperation with Adnoc.
“Korean companies are making contribution in sustainable development in the UAE. The ties between the two countries are strong and growing as more companies invest in the country,” the ambassador said at an event on Korea’s Corporate Social Responsibility in the UAE.
The bilateral trade between Korea and the UAE is more than $14 billion with Korea’s export volume consisting electronic items and automobiles placed at $6 billion and import which is mostly related to crude oil and LPG at $8 billion.