The South Korean government has announced a significant restructuring of its state-run energy companies to cut costs and enhance competitiveness. Key highlights include:
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Merging Power Companies: Five state-owned power generation firms—Korea South-East Power, Korea Midland Power, Korea Western Power, Korea Southern Power, and Korea East-West Power—will be consolidated into a single entity, Korea Power, a wholly-owned subsidiary of KEPCO. This merger will create one of the largest power generation companies globally, operating 53 GW of power generation capacity.
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Energy Resources Corporation Formation: The Korea National Oil Corp. (KNOC) and Korea Gas Corp. (Kogas) will merge to form a new entity, tentatively named Energy Resources Corporation. This move addresses the financial difficulties faced by both companies, especially KNOC, which has reported capital impairment losses related to overseas ventures and challenges during the COVID-19 pandemic.
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Liquidation of Korea Coal Corp.: The Korea Coal Corp. will be liquidated, reflecting a shift away from coal-based energy sources. Additionally, four regional port authorities will be amalgamated as part of the restructuring.
This overhaul aims to streamline operations and boost the overall effectiveness of South Korea’s public energy sector.
