In a somewhat rare post-U.S. election demonstration of practical thinking, South Korea’s deputy Energy Minister Woo Tae-hee advised private energy businesses in the country to invest more in U.S. oil and gas exploration projects.
In a speech that was to be delivered at a Seoul event, Tae-hee explained that the Trump presidency will greatly increase the uncertainly in global energy markets, and in order to minimize the adverse effects of this heightened uncertainty, South Korean businesses would do well to up their spending on exploration in the shale patch, as output from US shale is expected to rise under the new regime.
President-elect Trump has indeed made many statements to the tune of the U.S. leaving the Paris Agreement on fighting climate change and cutting oil imports to make the country energy independent. Trump has also pledged to help the oil and gas industry get back on its feet and bring back coal from exile.
All these statements suggest that the green policies of Obama’s administration may be reversed, and thus, “substantial changes in domestic and global energy markets are inevitable,” as Tae-hee points out in his speech, seen by Reuters.
As an example of good thinking in this respect, the deputy minister praised a 20-year gas supply deal between Korea Gas Corp and Cheniere Energy, which was sealed back in 2012. The deal should see Kogas receive Cheniere LNG shipments to the tune of 2.8 million tons a year beginning in 2017.
Tae-hee also noted in his speech that not all was not lost in renewables, adding that South Korean companies should seek cooperation with U.S. clean energy developers and producers. The Asian state earlier this year pledged US$37 billion for expanding renewable energy use and boosting the industry by 2020.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.