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Export-Import Bank offers financial support to state oil firm

The Export-Import Bank of Korea signs a memorandum of understanding with Korea National Oil Corp. to offer financial support worth about 1.1 trillion won. (Export-Import Bank of Korea)
The Export-Import Bank of Korea signs a memorandum of understanding with Korea National Oil Corp. to offer financial support worth about 1.1 trillion won. (Export-Import Bank of Korea)
The Export-Import Bank of Korea said Friday that it has signed a memorandum of understanding with Korea National Oil Corp. to offer the state-run oil company financial support worth about 1.1 trillion won ($1 billion).

KNOC, established in 1979 after the energy crisis in the 1970s to oversee oil storage businesses for the country, will use the fund to invest in overseas oil exploration and production, while working to find new energy sources like wind power, the company said.

“We expect to create a synergistic alliance, with the two state-run companies coming together to safeguard our energy security,” the Export-Import Bank of Korea said in a statement.

The latest exchange comes amid growing calls to bolster preparedness for an energy crisis, as South Korea has had to fight a recent urea shortage. Beijing began tightening exports of the key raw material last month to avert its own power crunch.

Urea solution is used in diesel vehicles to reduce emissions, and about 97 percent of Korea’s imports came from China during the first nine months of the year, according to the Trade Ministry.

Earlier this month, the Defense Ministry flew a plane to Australia to haul back 20 metric tons of urea, while discussing releasing its reserves, stoking concerns over a diminishing military stockpile.

By Choi Si-young (siyoungchoi@heraldcorp.com)
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