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Factbox: Recent M&As by Korea National Oil Corp, Samsung C&T
November 30, 2011 / 1:26 PM / 6 years ago

Factbox: Recent M&As by Korea National Oil Corp, Samsung C&T

(Reuters) - South Korea’s state-run Korea National Oil Corp (KNOC) KOILC.UL joined Samsung C&T 000830.KS to buy U.S. oil and gas company Parallel Petroleum from private equity group Apollo Global Management LLC (APO.N) for $772 million.

Following is a profile of South Korea’s state-run KNOC, including its recent overseas energy investments, and also Samsung C&T’s recent deals:

KNOC - THE COMPANY

Anyang, Gyeonggido-based KNOC is the national oil company which mainly invests in overseas oil exploration and production businesses, while running strategic oil storage businesses for South Korea, the world’s fifth-largest crude oil importer and the second-largest liquefied natural gas (LNG) buyer.

The state-run entity was established in 1979 to secure stable oil supplies after the oil crisis of the 1970s.

South Korea hopes to increase the country’s daily oil output capacity to 300,000 barrels per day by 2012 through KNOC and reserves to 2 billion barrels, rising from 50,000 bpd when the country started the expansion drive in June 2008.

KNOC said in an interview with Reuters last December it planned to spend between $2 billion and $3 billion to add 100,000 barrels per day (bpd) to 200,000 bpd of its crude production capacity by 2012, and was looking at 5-6 oil assets.

Kang Young-won is KNOC’s chief executive. Kang spent more than three decades with the now defunct Daewoo Group and helped Daewoo International (047050.KS) win a $5.6 billion gas development deal in Myanmar while serving as its CEO until 2008.

KNOC‘S RECENT DEALS

KNOC in March had struck two deals worth more than $2 billion to beef up its oil production as it agreed to buy a 23.67 percent stake in about 300 shale oil reserves with a unit of Anadarko Petroleum (APC.N) for $1.55 billion, and completed its purchase of a 95 percent of stake in Kazakhstan’s Altius for $515 million.

Last December KNOC and STX Energy acquired a combined 46.75 percent stakes and operation right in U.S.-based oil fields from Renaissance Petroleum for $55 million. Total reserves of the assets were estimated at 12 million barrels of oil equivalent.

KNOC’s Harvest Operations Corp also in the same month signed a C$525 million ($522.9 million) contract to fully buy Hunt Oil and Hunt Oil Alberta’s oil and gas assets in Canada. Total proven and probable reserves of the assets were estimated at 51 million barrels of oil equivalent.

In October of 2010, KNOC delisted Dana Petroleum after it purchased the Aberdeen-based firm for $2.6 billion. The deal is KNOC’s biggest acquisition and marks the first time an Asian state-firm has ever proceeded with an unsolicited bid.

In December of 2009, KNOC bought Kazakh oil developer Sumbe for $335 million. Under the deal, KNOC and its Kazakh partner acquired 85 percent and 15 percent, respectively, of Sumbe which owns two oilfields in western Kazakhstan.

KNOC agreed to pay C$1.8 billion in October 2009 for a friendly takeover of Canada’s Harvest Energy Trust and assume C$2.3 billion of long-term debt.

In February 2009, KNOC paid half of the $900 million price tag for a 50 percent stake in Petro-Tech, owned by private U.S. firm Offshore International Group.

KNOC also holds 80 percent stake in the Ankor oil producing project in the Gulf of Mexico, while Samsung C&T owns the remaining 20 percent after the stake acquisition was made in 2008 for 71 million barrels of oil reserves and 16,000 barrels per day production.

KNOC is also seeking to sell part of its stake in the U.S. Ankor offshore oil project to fund a new deal, South Korea’s economy ministry said in June.

SAMSUNG C&T IN RESOURCE DEALS

Samsung C&T said on its website (www.samsungcnt.co.kr) that the affiliate of Samsung Group, South Korea’s top conglomerate which also includes Samsung Electronics (005930.KS), was founded in 1938 and merged with Samsung E&C in Dec 1995.

The group has traditionally sealed smaller, bolt-on buys.

Samsung C&T is currently producing oil and gas in Ankor reserves, Algeria, China, Oman, Qatar, while participating in oil and gas exploration works at Yemen and Kazakhstan, according to a statement from Samsung C&T on Wednesday.

Samsung C&T is also set to produce nickel and lithium respectively from Madagascar’s Ambatovy project and Chile’s Atacama via its participation both in 2010.

Reporting by Cho Mee-young; Editing by Muralikumar Anantharaman

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