Korean trading firms increasingly tapping overseas natural resources

SEOUL, March 5 (Yonhap) -- South Korean trading companies are rushing to develop
overseas natural resources as part of efforts to seek a new growth engine,
industry sources said Thursday.

LG Corp., the fourth-largest trading company by sales, at the end of February
established Comox Joint Venture with Compliance Corp., a Canadian energy firm and
Itochu, a Japanese trading company, to develop a coal mine in Vancouver, Canada.
The company will complete the feasibility study for the mine by the first half of
next year, the sources said.
Last month, the company also started producing coal at a mine in Kalimantan
Island, Indonesia. LG plans to bring some of the coal to be produced in the mine
to South Korea and export the rest to Japan and South East Asian countries.
LG has three other mines that have launched commercial production in Russia,
Australia and the Philippines.
In addition, LG has begun producing 10,000 barrels of crude oil a day in an oil
field off the coast of Oman since last month.
Daewoo International Corp., the second-biggest trading firm, clinched a deal with
China National Petroleum Corp. to pipe natural gas, which was produced at its
offshore gas fields in Myanmar, into China in December of last year. Daewoo
started resource development projects in the country in 2000.
The company plans to produce nickel at a mine in Madagascar starting 2010, while
it has been exploring mines of nickel, copper and uranium in Australia and
Bolivia, the sources said.
The nation's No.3 trading firm Samsung C&T Corp. has been producing oil at an
offshore oil field in the Gulf of Mexico in partnership with state-run Korea
National Oil Corp. since January of last year.
Samsung also bought a palm farm in Indonesia in July of last year, which can
annually produce over 100,000 tons of palm oil used as a raw material for
biodiesel. The company is planning to supply palm oil produced in the farm to
biodiesel producers worldwide.
Biodiesel is a non-petroleum-based diesel fuel made using vegetable oil or animal
fat, which can be used in unmodified diesel-engine vehicles.
SK Networks Co., the biggest trading company, has been working on resource
development in five countries including China, Indonesia and Australia, the
sources said.
In May of last year, SK Networks won approval from the Chinese government to buy
the 45-percent stake in Northern Copper Industrial Co., a Chinese copper company.

Northern Copper owns a copper mine in the Chinese province of Shanxi, which has
1.5 million metric tons of reserves.
ksnam@yna.co.kr
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