South Korea Oil and Gas Market Size
| Study Period | 2020 - 2029 |
| Base Year For Estimation | 2023 |
| Forecast Data Period | 2024 - 2029 |
| Historical Data Period | 2020 - 2022 |
| CAGR | > 1.50 % |
| Market Concentration | High |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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South Korea Oil and Gas Market Analysis
The South Korea Oil and Gas market is expected to grow at CAGR greater than 1.5% during the forecast period of 2022-2027.
The Covid-19 pandemic severely affected the oil and gas market in South Korea, leading to a fall in consumption and significant delays in major upcoming projects. Over the long-term, burgeoning demand for petrochemicals is expected to drive the market during the forecast period.
- Due to the growing demand for refined products and the maturity of the sector, the downstream segment is expected to retain its market share as the dominant segment
- Due to a lack of domestic reserves, the upstream sector is expected to see limited growth, restraining the growth of the market during the forecast period.
- The exploration and development of South Korea's unexplored offshore acreage remains a significant growth opportunity for the market during the forecast period.
South Korea Oil and Gas Market Trends
This section covers the major market trends shaping the South Korea Oil & Gas Market according to our research experts:
Downstream segment to dominate the market
- The Downstream segment of the South Korea Oil & Gas market is one of the most well-developed segments in the world, and the country is home to some of the biggest and most advanced oil refineries globally.
- In 2021, the country had a refining capacity of 3,572 thousand barrels per day,unchanged from 2020. No large-scale expansion or modernisation projects or new refineries are planned to come online in the next several years.
- One of the primary factors driving the downstream sector is the demand for refined products such as gasoline and diesel in the transportation sector and the demand for other petroleum derivatives such as ethylene for the production of chemical products and polymers, and increasing the export of chemicals and polymers to other nations.
- In August 2022, Kumho Petrochemical announced that it planned to invest nearly KRW 3.3 trillion in its core business areas for expanding production capacity of nitrile butadiene latex (NB latex) and styrene solution butadiene rubber (SSBR) over the next 5 years.
- In September 2021, DL Chemical Co., the petrochemical arm of South Korea's DL Group, announced its plan to spend KRW 2 trillion (USD 1.7 billion) over the next five years to boost its production capacity, which will include additional production capacity from mergers and acquisitions. DL Chemical is planning to transform itself into a manufacturer of high-value speciality chemicals used in sectors such as construction and electronics, which have been enjoying high demand.
- LG Chem Ltd., South Korea's top chemical manufacturer, announced in August 2021 that it plans to spend KRW 2.6 trillion (USD 2.2 billion) to strengthen its green business portfolio as it steps up efforts to transform into an eco-friendly company. With the investment, the company will build 10 new chemical factories in Seosan, South Chungcheong Province, mainly producing biodegradable materials and other sustainability-focused chemical products. The company plans to begin commercial operations for PBAT (polybutylene adipate-co-terephthalate) factory and a POE (polyolefin elastomer) plant by 2024.
- Such investment trends in the refining and petrochemical sector are expected to drive the downstream segment significantly during the forecast period.
Government efforts to reduce coal and nuclear consumption to drive the LNG -to-power segment and LNG imports
- Owing to the lack of domestic resources, South Korea remains dependent on gas imports to meet around 98% of its fossil fuel consumption. In 2020, South Korea imported 55.3 Billion Cubic Meters of LNG, witnessing a slight drop of 1% compared to 2019. Further, South Korea is the third-largest importer of LNG after Japan and China, accounting for about 11.3% of the total world's LNG imports. The country has no international oil or natural gas pipelines and relies exclusively on LNG and crude oil tanker shipments.
- According to South Korea's Basic Plan for Power Supply 2020-34, released in December 2020, the country will increase the capacity of LNG-based power plants by 43% to 59.1 GW in 2034 from 41.3 GW in 2020 while reducing coal-fired power plants and nuclear reactors. According to the plan, LNG-based power plants will have a capacity of 43.3 GW in 2022, 55. 5GW in 2030 and 59.1 GW in 2034.
- To reduce carbon emissions, under this plan, the country aims to close down 30 ageing coal-fired power plants, or half of its 60 coal-fired power stations currently under operation, by 2034. Of these 30 planned closures, 24 will be replaced by a combined capacity of 12.7 GW that will be converted into natural gas-fired power plants. This is expected to create long-term demand for LNG, boosting LNG import volumes, which is expected to drive the midstream sector during the forecast period.
- In January 2022, South Korea shut down 2 of its oldest coal-fired power plants, the 250 MW- Honam Coal Power Plant No. 1 and No. 2, built in 1973. The plants are expected to be replaced by 2 LNG-fired power plants and a hydrogen fuel cell power plant. These large-scale closures of coal-based thermal power plants are expected to create a massive demand for LNG during the forecast period.
- As of 2021, South Korea's state-run Korea Gas Corp (KOGAS) was one of the largest buyers of LNG, importing nearly 38.17 MT of LNG in 2021, up 19.6% from 2020, and accounting for almost 83.1%of the country's total LNG imports. As of 2021, KOGAS has 9 long-term contracts -- 9.02 MTPA in 3 contracts from Qatar, 4 MTPA from Oman, 3.5 MTPA from Australia, 2 million MTPA from Malaysia, 0.7 MTPA from Indonesia, 1.5 MTPA from Russia's Sakhalin, and 2.8 MTPA from the United States Sabin Pass.
- In April 2022, South Korea's state-run Korea Gas Corp (KOGAS) signed an 18-year sales and purchase agreement with BP Singapore Limited for importing 1.58 MTPA (Million tons per annum) of LNG starting from 2025.
- Such large-scale LNG purchase contracts are expected to create a demand for additional LNG handling and transport infrastructure, which is expected to drive the midstream segment during the forecast period.
South Korea Oil and Gas Industry Overview
The South Korean oil and gas market is highly concentrated. Some of the major players in the market (in no particular order) include Korea National Oil Corporation (KNOC), Korea Gas Corporation (KOGAS), S-Oil Corporation, SK Energy, and Hyundai Oilbank Co., Ltd, among others.
South Korea Oil and Gas Market Leaders
Korea National Oil Corporation (KNOC)
Korea Gas Corporation (KOGAS)
S-Oil Corporation
SK Energy
Hyundai Oilbank Co., Ltd
*Disclaimer: Major Players sorted in no particular order
South Korea Oil and Gas Market News
- In January 2022, the country passed a resolution labelling LNG as a green fuel, as a part of its decarbonisation strategy to achieve a clean energy transition. This move is expected to have an impact on green financing, the future course of carbon taxes/emissions caps, the decommissioning pathway of coal-fired plants and South Korea's future energy mix
- In July 2021, South Korea's state-run Korea Gas Corp (KOGAS) signed a 20-year LNG supply agreement with Qatar for the next 20 years starting in 2025. The contract stipulates that KOGAS will buy 2 million tons of LNG annually from Qatar Petroleum. The energy ministry added that KOGAS buys 9 million tons of LNG annually from Qatar through long-term contracts, and a contract worth 4.9 million tons of LNG is expected to end in 2024
South Korea Oil and Gas Market Report - Table of Contents
1. INTRODUCTION
1.1 Scope of the Study
1.2 Market Definition
1.3 Study Assumptions
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET OVERVIEW
4.1 Introduction
4.2 Crude Oil Consumption Forecast in thousands barrels per day, till 2027
4.3 Natural Gas Consumption Forecast in billion cubic feet per day, till 2027
4.4 Refinery Installed Capacity and Forecast in thousand barrels per day, till 2027
4.5 LNG Terminals Installed Capacity and Forecast in MTPA, till 2027
4.6 Recent Trends and Developments
4.7 Government Policies and Regulations
4.8 Market Dynamics
4.8.1 Drivers
4.8.2 Restraints
4.9 Supply Chain Analysis
4.10 PESTLE Analysis
5. MARKET SEGEMENTATION BY SECTOR
5.1 Upstream
5.2 Midstream
5.3 Downstream
6. COMPETITIVE LANDSCAPE
6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements
6.2 Strategies Adopted by Leading Players
6.3 Company Profiles
6.3.1 Korea National Oil Corporation (KNOC)
6.3.2 Korea Gas Corporation (KOGAS)
6.3.3 S-Oil Corporation
6.3.4 SK Energy
6.3.5 Hyundai Oilbank Co., Ltd
6.3.6 GS Caltex Corp
6.3.7 SGS Group
6.3.8 Hankook Shell Oil Co., Ltd
6.3.9 CNCITY energy Co., Ltd
6.3.10 Daesung Industrial Co., Ltd.
6.3.11 Kukdong Oil & Chemicals Co., Ltd.
- *List Not Exhaustive
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
South Korea Oil and Gas Industry Segmentation
The oil and gas market includes revenues from all operations involving the commercial production of hydrocarbons. These operations include exploration, production, transport, handling, storage and refining of hydrocarbons. The market is segmented by sector. By sector the market is segmented as upstream, midstream and downstream.
South Korea Oil and Gas Market Research FAQs
What is the current South Korea Oil & Gas Market size?
The South Korea Oil & Gas Market is projected to register a CAGR of greater than 1.5% during the forecast period (2024-2029)
Who are the key players in South Korea Oil & Gas Market?
Korea National Oil Corporation (KNOC), Korea Gas Corporation (KOGAS), S-Oil Corporation, SK Energy and Hyundai Oilbank Co., Ltd are the major companies operating in the South Korea Oil & Gas Market.
What years does this South Korea Oil & Gas Market cover?
The report covers the South Korea Oil & Gas Market historical market size for years: 2020, 2021, 2022 and 2023. The report also forecasts the South Korea Oil & Gas Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
South Korea Oil and Gas Industry Report
Statistics for the 2024 South Korea Oil and Gas market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. South Korea Oil and Gas analysis includes a market forecast outlook 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
