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2022-08-06
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South Korea wants to become the world's fourth largest oil trade center

South Korea wants to become the world's fourth largest oil trade center

201 this kind of mobile phone is usually heavier than equipment with the same volume of materials. April 21, 2004

[China paint information] South Korea's Ministry of energy recently said that South Korea plans to become the world's fourth largest oil trade center after New York, London and Singapore. The government is actively promoting this strategy at the China International Rubber and plastic exhibition last month, including providing tax incentives to global oil trading companies, relaxing restrictions on oil trade, supporting the construction of new commercial oil storage capacity, and leasing state-owned oil storage facilities to the private sector

obvious regional and cost advantages

South Korea has the geographical advantage of being located in the center of Northeast Asia. Stimulated by the strong growth of China's demand in recent years, the oil consumption and trade in Northeast Asia are increasing rapidly. South Korea, China and Japan currently consume 16.3 million barrels of oil per day, accounting for 19% of the total global consumption. Among the three countries, South Korea is the most competitive in terms of oil transportation and refining costs

at present, the oil transportation cost in South Korea is $1.37/barrel, and the oil refining cost is $2.33/barrel; The oil transportation cost in China is 1.38 USD/barrel and the oil refining cost is 6.12 USD/barrel; Japan is 1.43 USD/barrel and 3.12 USD/barrel respectively

the major oil refiners in South Korea are all located in the south coast of the country, among which SK innovation, the largest oil refiner, is located in Ulsan, GS Caltex, the second largest oil refiner, is located in Lishui, and S-oil, the third largest high-end quality oil refiner, is located in Aung San. The south coast of Korea may become the fourth largest oil center after the Gulf coast of the United States, Ara (Antwerp, Rotterdam and Amsterdam) in Europe and Jurong in Singapore

increase preferential policies

the Ministry of energy of the Republic of Korea said that according to the plan, major oil traders operating in the Republic of Korea will enjoy a corporate tax exemption of 22% of the quota for a period of five years, and will also enjoy a tax reduction of half for a period of two years. The government will also provide other incentives to oil traders, including housing and education benefits for family members. The Ministry also pointed out that the plan also calls on South Korea to establish a platform for oil trade-related financial services and oil derivatives trade, but the details will be announced later

the Ministry of energy said: "the government will relax financial controls on major oil traders and improve financial infrastructure in order to establish a regional oil center in Korea. The government will also invite oil price assessment agencies to help establish benchmark oil prices in Northeast Asia. The government will relax restrictions on oil blending, storage facilities and transportation and reduce tariffs to facilitate the trade flow of crude oil and oil products."

commercial storage capacity will exceed that of Singapore

according to the current law, foreign oil traders must have certain storage capacity for trade in South Korea, but South Korea plans to cancel this restriction. The government will also lease about 20million barrels of storage capacity to the private sector. In this way, by 2020, the total commercial oil storage capacity of South Korea will reach 56.6 million barrels, exceeding that of Singapore's 52million barrels

Korea National Petroleum Corporation recently plans to build a new product oil storage terminal in Ulsan, on the southeast coast of Korea, with a design storage capacity of 9.9 million barrels. It is expected to be completed and put into operation in 2017. In January this year, the Korean National Petroleum Corporation established a joint venture with Fubao and S-oil to take charge of the product oil terminal project, with an estimated investment of 622.2 billion won (581million US dollars). The terminal will become the second commercial oil storage terminal in South Korea. The first commercial oil storage terminal in South Korea was completed and put into operation in April 2013. It is located in Lishui, southwest of Ulsan, with a design storage capacity of 8.2 million barrels, including 3.5 million barrels of crude oil and 4.7 million barrels of finished oil. South Korea also plans to build its third commercial oil storage terminal in Ulsan, with a design storage capacity of 18.5 million barrels. It is expected to be completed and put into operation in 2020, when the total domestic commercial oil storage capacity will reach 36.6 million barrels

little impact on strategic oil reserves

the Korean government has nine strategic oil storage bases nationwide, and the design reserves of crude oil and refined oil have reached 146million barrels. The world's largest oil storage facility in Lishui has a design storage capacity of 49.7 million barrels. At present, the national reserve of crude oil and product oil in South Korea has reached 134million barrels, including 44.3 million barrels of foreign oil made of special alloy materials for nuclear power main equipment such as energy equipment and reactor pressure vessels. If the government plans to lease 20million barrels of storage capacity to the private sector, it means that the government should reduce storage

the person in charge of energy and resources policy of the Ministry of energy of the Republic of Korea said: "renting storage capacity to the private sector will not reduce the strategic oil reserve of the Republic of Korea, because the government is only seeking to use the excess capacity, and the government will still maintain the strategic oil reserve level recommended by international organizations. The current strategic oil reserve of the Republic of Korea can meet the 123 day consumption, which is much higher than the 90 day reserve recommended by the International Energy Agency."

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