Ministry of Trade, Industry and Energy

The Ministry of Trade, Industry and Energy (MOTIE) announced on October 22 that on the occasion of the Korea-Saudi summit meeting in Riyadh, a number of energy institutions, companies and MOTIE entered two agreements and five memorandums of understanding (MOU) with Saudi counterparts.

First, MOTIE’s Minister Bang Moon Kyu and Saudi Energy Minister Prince Abdulaziz bin Salman signed the “Korea-Saudi Hydrogen Oasis Cooperation Initiative” MOU on behalf of the two countries’ governments for expanding mutual cooperation in clean hydrogen areas.

As a nation rich in conventional energy resources, Saudi Arabia is also increasing investments in clean hydrogen industries for future energy development and carbon neutrality. Korea and Saudi Arabia have been paving the way for a cooperation roadmap spanning the entire hydrogen ecosystem from production to distribution and utilization based on their respective strengths, and it is on these public-private joint efforts that this cooperation initiative was sealed.

In line with this initiative, Korea Electric Power Corporation (KEPCO), POSCO Holdings, Lotte Chem among other Korean firms agreed on a letter of intent (LOI) for cooperation in a blue ammonia project valued at USD 15.5 billion in the Ras Al-Khair region with Saudi’s Aramco. HD Hyundai Oilbank and Aramco also entered a “Clean Hydrogen Energy Project Cooperation MOU”, while KEPCO and Saudi’s Al Jomaih Energy and Water Co. signed a hydrogen project deal.

Meanwhile, Korea National Oil Corporation (KNOC) signed a crude oil reserve agreement with Aramco, by which Aramco will be storing crude oil in the Ulsan Oil Hub, and Korea will be able to exercise a preferential purchase right to 5.3 million barrels of Aramco’s crude oil for supply emergencies.

HD Hyundai Electric and Saudi’s investment firm AlGihaz entered an MOU on substation bid cooperation, and Korea’s power boiler and heat exchanger manufacturing company BHI and Saudi’s Rezayat Group entered one on power plant equipment and materials supply.

The Korean government plans to give full measure to transitioning the Korea-Saudi relations from traditional energy sources to a forward-looking, clean hydrogen cooperation based on the outcomes of the economic summit diplomacy.