Korea National Oil

RATING

SECTOR

Construction, Oil & Gas Operations, Mining and Chemicals

WEBSITE

CONTACT

305, JONGGA-RO
JUNG-GU
ULSAN, (44538)
Republic of Korea

Tel: (+82)52-216-2114
Fax: (+82)52-216-5900

 

STOCK EXCHANGE

N/A

LISTING

EMPLOYEES

1,372

CHIEF SUSTAINABILITY OFFICER

N/A

AWARDS

CONTENT SOURCE

FURTHER READING

Report created by Katerina Vargova

Korea National Oil Corporation

SECTIONS :  Sustainability    Evaluation  •  Progress  •  Watch  •  Overview

Company Activity

Korea National Oil Corporation (KNOC) is the national oil and gas company of South Korea and one of the most important industrial companies in the country. The company operates oil and gas fields in Vietnam, Libya, Peru, Indonesia, Nigeria, Yemen, Kazakhstan, Russia, Canada and South Korea. The company has oil reserves of around 600 million barrels (95,000,000 m3) and gas reserves of 10 billion m3.

In 1979, the very year in which the global oil crisis occurred, KNOC was founded to stabilize the national economy of Korea by securing a stable oil supply to the country through strategic petroleum stock-piling and development.

KNOC is operating various projects in 14 countries around the world, which include oil fields in the North Sea and shale gas fields in North America. Total reserves reach almost 1.4 billion barrels and a daily production of about 170,000 barrels.

Company Sustainability Activity

In recognition of the needs for securing reasonable profitability, meeting the level of global leading companies, and operating systematic ethical management, KNOC established the Global Business Ethics Strategy for Top (B.E.S.T.) performance as its strategic goal for ethical management.

To achieve the goal, KNOC has not only reorganized the ethics charter and code of conduct but has also strived to form a company-wide consensus through the development of unique ethical management programs, a circuit of ethical education at home and abroad, and a quiz contest on the code of conduct. Its overseas branches are also very active in joining ethical management. Such endeavours enable employees to conduct their jobs under ethical standards and reasonable procedures, and help the company fulfil its social responsibilities.

KNOC is committed to implementing social contribution activities reflecting its business features and social demands. These programs include Sunshine to assist residents with heating expenses, Happy Together to aid rural villages during the farming season and support the education of children from low-income families, and Hopeful Energy to provide scholarships for the cultivation of talents dedicated to the E & P sector.

Highlights

  • 4% of women in management – one female board member 
  • Zero oil spill in the last 3 years at domestic workplaces

Targets

  • Reduction of domestic GHG emissions
  • Reduction in VOCs emission
  • Hiring rate of high school graduates according to the government guideline of 10%
  • Minimize the environmental impact caused by storage and management of strategic oil reserves and oil development

Progress

  • 113% of 2019 GHG emission reduction target
  • Reduction in VOCs emission by 55.5% using the optical inspection system of oil storage
  • VOCs reduced by 460 tons per year through the gasoline tank improvement project (~ 2023)
  • 33% hiring rate of high school graduates 
  • Achieved zero accidents at domestic workplaces for 19 consecutive years
  • Reduced accidents by 60% at the underground storage construction site

Certificates

UN Sustainable Development Goals

UN SDGs Compliance

SDG 7

  • Following the Paris Climate Agreement, as global investor groups announced the withdrawal and suspension of investment in the oil and gas sector, more and more oil companies are being asked to switch to a low-carbon economy and to disclose their business. KNOC has participated in international oil events such as the CEO Roundtable hosted by ADNOC and the ADIPEC (Abu Dhabi International Petroleum Exhibition and Conference) 2019 to discuss issues facing the oil industry with global oil companies. 
  • The Korean government announced the Renewable Energy 2030 Implementation Plan setting a goal to produce 20% of its energy from renewable sources by 2030. KNOC is pursuing a Green Energy Complex project to meet this trend of expanding new and renewable energy. It is expected to contribute to the conversion of low-carbon energy through promoting green energy complex projects, such as floating offshore wind power generation projects by utilizing the experience of oil and gas resources exploration, development and production and the construction and operation of offshore production facilities.

SDG 8

  • Lead a safety culture in local communities by strengthening Private-Public-Community Disaster Cooperation System
  • KNOC’s goal when it comes to job creation is to provide good quality jobs for individuals. In particular, KNOC focuses on providing more opportunities to those who are disadvantaged in the job market, and on operating stable and healthy work environments. In cooperation with the Korea Employment Agency for the Disabled and the Ulsan Sports Association for the Disabled, KNOC hired disabled athletes so that they could focus on their sports in a stable environment.

SDG 9

  • The economical gas stations distribute high-quality oil purchased at a low price from KNOC at a reasonable price by minimizing additional services. In addition, they post their own oil prices to Opinet, KNOC’s oil price information service, affecting the prices of gas stations nationwide and thereby contributing to the reduction of national fuel costs. KNOC is subsidizing construction costs for new gas stations to revitalize economical gas stations, and conducts regular inspections on facilities and oil quality to create a pleasant gasoline environment and eradicate fake oil. It also helps small operators overcome difficulties by operating a fuel price discount system based on monthly purchases, and providing financial support such as extension of repayment of debt and interest exemption in response to the recent COVID-19 situation.

SDG 10

  • In order to meet the social demand for fair hiring, KNOC manages and supervises the entire recruitment system, from recruitment to sanctions against misconduct. For hiring professional career staff, it has raised the selection criteria and ratio of external judges over the government guidelines. Also, it has introduced a system to review application documents in the presence of an auditor and discloses the applicant’s score and ranking upon announcement of successful applicants to guarantee the right to know of applicants and strengthen the fairness of recruitment.
  • KNOC is strengthening institutional support for the underprivileged, including high school graduates, local talents, and the disabled in the hiring process, thereby realizing a sustainable society without discrimination.

SDG 13

  • In order to respond to climate change and the resulting natural disasters, KNOC has established “Climate Change Adaptation Measures for Storage Sites,” and is implementing detailed annual implementation plans. It achieved 113% of its 2019 GHG emission target by continuously monitoring GHG emissions. To save energy, it has introduced three eco-friendly electric vehicles, and has raised the LED lighting penetration rate at its business sites to 92.1%. It completed 275kW solar power generation facilities in Seosan, Donghae, and Yongin storage sites to expand the supply of new and renewable energy. KNOC will realize a low-carbon energy future by continuously reducing GHG emissions and managing energy targets.


Secondary SDGs: 3, 4, 14, 15, 16, 17

Evaluation

Korea National Oil Corporation is listed in many Korean initiatives, but only in a few international sustainable indices. KNOC has won several national awards, but no international awards. The company has a handful of certificates.

KNOC meets the UN’s Sustainable Development Goals, but lacks transparency in its reports.

The KNOC has set vague goals without clear steps on how to achieve them. KNOC is rated a D.

Analyst Outlook: Negative

Although KNOC is an international company operating in many countries, the company is reducing its GHG emissions only in South Korea. KNOC is making little progress towards renewable energy.

Key Points

  • Only 4% of women in management
  • The debt ratio of KNOC is estimated to exceed 7,200%
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