South Korean companies plan to invest a record US$7.8 billion in overseas crude and natural gas development projects in 2011 to help raise the country's energy self-sufficiency level, a government survey showed Sunday.
The total represents a 29 percent increase from around $6 billion injected into this field last year, with the amount of money to be spent jumping 3.5-fold compared to 2007, the Ministry of Knowledge Economy said.
"If investments take place as planned, the country's self-sufficiency in oil and gas resources should reach around 13 percent of domestic demand this year from 10 percent estimated to have been reached in 2010," a ministry official said.
Of the total to be invested, 84 percent will be carried out by state-run Korea National Oil Corp. (KNOC) and Korea Gas Corp. (KOGAS), with the rest being handled by the private sector.
KNOC and KOGAS are to pour slightly over $6.5 billion to develop oil fields and gas wells this year with private energy companies to allocate more than $1.2 billion into foreign ventures.
The proportion of private sector investment in this field may account for 16 percent of all money to be spent, which is an increase from 10 percent reached in 2010.
A forecast based on polls taken from 35 local natural resources developers showed that 27 percent of all investments, or $2.1 billion, should go to North America, with the Middle East and Southeast Asia to receive $1.2 billion and $900 million, respectively.
The ministry, meanwhile, said that on a global scale, governments and businesses could spend $490 billion to find and produce oil and gas resources. This is an 11 percent on-year gain from the year before.
South Korea, with almost no gas and oil reserves of its own, has taken active steps in recent years to buy stakes in existing development projects and win exploration and development rights that can better insulate the national economy from sudden fluctuations in energy prices.
In a separate report, the ministry said it will spend 7.83 billion won this year to carry out surveys for overseas mineral resources development, up 77.6 percent from the previous year.
The sharp increase mirrors heightened demand for surveys in resources-rich African countries, such as Zambia, and Central and Latin America, where many countries have deposits of rare earth elements, it added.