KNOC, Aramco Seal Oil-Storage Agreement
State-run Korea National Oil Company (KNOC) signed an oil-storage agreement with Saudi Oil giant Aramco to have a joint oil reserve of 5.3 million barrels over a period of 5 years, according to Yonhap news agency reported, citing KNOC.
The agreement was announced during a press conference posted on the KNOC’s blog.
This announcement coincides with the South Korean president’s visits to Riyadh to meet the Crown Prince Mohammed bin Salman and attend other business events.
Agreement Details
The oil will be stored at a reserve in coastal city Ulsan located in southeastern part of Korea, said the office of south Korea’s President on Sunday.
The office added that Korea will have the benefit of preferentially buying the reserved oil in case of emergency. Furthermore, it will get rental fees for those five years.
Storing Aramco’a oil in its facilities, KNOC will be able to enhance energy security.
Aramco could not be reached for a comment.
South Korea is the world’s fifth-biggest crude oil buyer and KSA is its first supplier which makes these two countries fit like puzzle pieces into this agreement.
Cementing Saudi-South Korean Ties
Saudi Arabia and South Korea signed about 50 business deals in KSA capital, Riyadh, said the Korean Ministry of Trade, Industry and Energy on Sunday.
These deals break down to 40 memoranda of understanding (MoU) as well as six contracts in energy, infrastructure, manufacturing, robotics and finance fields.
Energy, Power
The 2023 Korea-Saudi Arabia Investment Forum witnessed inking two contracts and five MoUs in energy and power sectors.
Besides the oil-storage agreement between KNOC and Aramco, Korea Electric Power, POSCO Holdings and Lotte Chemical sealed a letter of intent(LOI) with Aramco to produce blue ammonia.
Infrastructure, factories
A MoU for cooperation in Saudi real estate and infrastructure was signed between Hyundai E &C and Saudi investment ministry.
Korea’s Poonglim Pharmaech and Saudi Arabia’s All Care Group For Investment signed a contract to establish a factory in KSA for medical devices.
These agreements are just the tip of the iceberg, as a plethora of agreements, contracts and MoUs were signed in these fields.
History of Cooperation
This is not the first time for the two countries to cooperate in such fields.
Earlier this month, KSA and South Korea signed 56 projects at a Saudi Arabia-Korea Vision 2030 Committee meeting.
In November 2022, KSA and South Korea signed 26 bilateral projects worth $29 billion.
$21 million deals were discussed as possible prospects of cooperation that can be realized within a year, as per KORTA.
Related Topics
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