Korea National Oil Corp. (KNOC) and Petro Vietnam signed an MOU on strengthening cooperation between the two oil companies on oil storage and exploration at the Shilla Hotel on March 29 in the presence of Vietnamese Prime Minister Nguyen Tan Dung, President Do Van Hau of Petro Vietnam, and President Kang Young-won of KNOC.

KNOC has been able to maintain close relations with Petro Vietnam through its work on the 11-2 gas field and the 15-1 mining district in Vietnam, and through the MOU signed, KNOC will be able to help Petro Vietnam build its underground oil storage facilities, taking advantage of its accumulated experience and technologies for building and operating its own underground oil storage facilities, considered the largest such facility in the world.

KNOC previously signed on Dec. 7, 2011, an MOU with PVOS, an affiliate of Petro Vietnam, in connection with building underground oil storage facilities in the areas of operation and management (O&M) and the training of personnel.

Upon request from Petro Vietnam, KNOC will hold a meeting to explain the details of the MOU and sign a basic agreement, which would result in a substantial improvement in the cooperative relations between the two oil companies. KNOC is considered to have laid a base to export its technologies related to oil exploration and construction of underground oil storage facilities overseas, KNOC said.

KNOC held its 2012 strategy meeting on Jan. 26-27 for its overseas unit heads at its head office in Seoul to discuss and draw up the company’ s major strategies for this year.

 With the unit heads of KNOC’s 17 overseas units in 14 countries, a total of 47 personnel attending, the two-day meeting led by President Kang Young-won took up such issues as those faced by each unit and issues that require immediate solutions facing the company as a whole, especially those related to pushing the Great KNOC 3020 vision, such as mid- to long-term strategies and synergy among KNOC-invested firms abroad.

The Great KNOC 3020 was announced in 2008 in line with the government policy to make KNOC greater. Under the strategy, KNOC’ s daily crude oil production would reach 300,000 barrels and its secured untapped oil reserves would increase to 2 billion barrels in 2012.

President Kang called on all of the participants in the meeting to arm themselves with a challenging spirit so that the company would be able to cope with the changing situations in the global oil exploration business. If every overseas unit does its best to achieve, KNOC will be able to expand its self-sufficiency in oil exploration by 20 percent this year as called for in the Great KNOC 3020.

Kang said, “We ought to tighten our belts and do our best to achieve objectives prescribed in the long-term vision of the company for this year.”    The CEO called for the tight execution of the free cash flow rolling plan with various back up measures for diversifying asset liquidity, a very important factor for creating funds for large investments.

Kang also said in his New Year’ s address this year that the settling down of a corporate culture befitting KNOC’ s operational growth is also an important factor, adding that he hopes this year would the year for KNOC to take its place as a global oil development firm as a base for organic growth backed up by various successes in management and operational reforms accomplished thus far. 

“We have to do our best to boost the company’ s corporate value by increasing the rate of success in our test drillings in various mining blocks scattered around the world by training our crew engaged in the project, which will upgrade the level of our oil drilling,” Kang said.

“2012 is the year for the accomplishment of the Great KNOC 3020 and the initial year for the post-period of the great plan. We ought to create great performance results by maintaining a consensus so that we may be called a top global organization,” he said.

KNOC said its Ada oil field in Kazakhstan, which has been explored since 2009, was found to contain 11 million barrels of crude oil recently. The new discovery brought the total untapped crude oil in the mining districts in the No. 5 Basenkol to 41 million barrels, boosting the economic feasibility of the mining district with the discovery of new crude oil reserves.

The company expects to find from 17 million to 42 million barrels more oil as it continues to conduct test drilling at other sites in the same mining district in addition to the 11 million barrels found already.