The Korean government has aggressively attempted to secure oil, coal and other energy resources through aggressive acquisitions and explorations. However, in large part, the major ventures have failed because of a lack of foresight, inexperience and, most critically, the active use of inexperienced Korean advisors (Korean lawyers and consultants).
Some of the projects sold to the Korean government were nothing more than scams. The Korean government is still hell-bent on not having the active involvement of experienced non-Korean advisors. The government is also not willing to spend the needed money necessary to properly conduct feasibility studies. I hope that the situation will quickly change.
Because of these failures and the upcoming elections in Korea, the Korea National Oil Corporation’s (KNOC) has vowed to more carefully select acquisition targets. Many politicians and the local media are carefully observing this issue.
KNOC has announced that it intends to sell 80% of the stake in a Gulf of Mexico oil field. The stake is likely to be sold to the Korean National Pension Service (taxpayer-funded pension) and local Korean investors. KNOC is Korea’s national oil developer. The corporation is wholly owned by the Korean government.
KNOC is broke. KNOC has over USD 10 billion in debt and a growing list of failed programs. The most recent Korean government failure being a USD 400 million loss in the Kurdish area of Iraq. A little side note, many of the largest Korean government corporations are broke for the same reasons as mentioned above.
A good article on the recent Kurdish failure by the Korean government can be found in an article in the Chosun Ilbo.