Import Diversification
Korean oil refining companies are trying to import more crude oil from the US to diversify their sources and move away from the Middle East.
GS Caltex is about to finish the refinement of the condensate it imported in July from the United States. Produced in Texas, the condensate is currently at the final stage of refinement at its refinery in Yeosu City. The total amount is 400,000 barrels.
Condensate, which is volatile liquid hydrocarbon, is obtained during natural gas production. Naphtha, kerosene, diesel, and the like can be extracted from the super-light crude oil at a refinement cost much lower than that for crude oil in general.
These days, Korean oil refining companies are trying to import more crude oil from the United States in the interest of lessening their dependence on the Middle East. “The current political situations in Iraq are highly problematic in terms of demand and supply, and the monopolistic position of Middle Eastern oil exporters has posed a severe problem as well,” said an industry source, adding, “Things will be much stabilized once the U.S. government allows petroleum exports.”
The United States has banned the export of its oil for about four decades. It enacted the Energy Protection Act in 1975 for that purpose, with international oil prices having skyrocketed from 1973 because of Middle Eastern countries that had prohibited the export of crude oil to the U.S. The condensate export to GS Caltex was a particular exception made possible by reinterpretation of existing law, and caused an industry-wide controversy.
