Korea's SK Innovation Seeks US Shale Expansion
South Korea's SK Innovation Co, which owns the Asian country's biggest refiner SK Energy, said it aims to increase investment in US shale fields and increase partnerships with major crude producers to stabilize energy supplies.
The company said it wants to expand shale gas fields in the US states of Oklahoma and Texas acquired last year into nearby areas, as well as boosting competitiveness by diversifying crude sources and cutting import costs.
"Given low oil prices and the cost pressure on shale companies, we are actively looking for business chances," SK Innovation's chief executive and president Chung Chul-khil told a press conference.
Via its US unit SK E&P America, SK Innovation last year started to develop US oil fields by acquiring two assets, one each in Oklahoma and Texas, for a combined 387 billion won ($350 million).
SK Innovation now believes the time is right to acquire additional US assets, and expects an increasing number of offers from producers hit by low oil prices, said Ki-tae Kim, president of exploration and production (E&P).
Due to a supply glut, global crude prices tumbled from their peaks in mid-June 2014, losing as much as 60% of their value and pressuring high-cost producers, particularly in US shale developments.
Kim said exploration properties in the Anadarko Basin, which stretches across the western part of Oklahoma and the Texas Panhandle, would be a good fit as the company already has operations in the region.
SK Innovation's investments last year in Oklahoma and Texas were its first in the US since beginning its overseas E&P business in 1983