MOCIE Struggling to
Fix Energy Issues
APEC Countries to Hold the 7th Energy Ministers'  Meeting on October 19

About 200 people, including energy and mining ministers from 21 APEC member countries and vice ministers will get together in Seoul on October 18-21 to discuss such agendas as steps designed to cope with oil price hikes during the 7th Energy Ministers?Meeting & the 2nd Meeting of Ministers Responsible for Mining.
The upcoming meetings are significant with the OPEC acting secretary general Adnan Shihab-Eldin participating, as the APEC countries, oil consumers, are expected to discuss the opening of a dialogue channel with the Organization of the Petroleum Exporting Countries (OPEC).
In an interview with NewsWorld, Minister of Commerce, Industry and Energy Lee Hee-beom fleshed out a wide range of government policies designed to address energy issues amid the lingering oil price hikes. The following are excerpts of the interview.
Question: Would you explain to our readers about the agenda items, to be discussed during the upcoming the 7th Energy Ministers?Meeting & 2nd Meeting of Ministers responsible for Mining, the significance of Korea's hosting the meetings and their effects?
Answer: The agenda items like steps designed to cope with oil price hikes and a reduction in APEC countries'dependence on oil, ways of securing a stable supply of energy sources and OPEC-APEC business dialogue will be discussed during the 7th Energy Ministers' Meeting (EMM7), to be held in Gyeongju on October 19.
Korea will hold bilateral ministerial talks with China, Japan and Australia, respectively, to discuss topics of mutual concern in the energy sector.
Minister of Commerce, Industry and Energy Lee will hold bilateral discussions on the stabilization of oil prices and a stable supply of crude oil with the OPEC secretary general.
The 2nd Meeting of Ministers Responsible for Mining (MRM2) will take up issues like steps designed to reduce market uncertainties, promote brisk trade and step up cooperation in mining exploration and development as well as mining environment management on October 20. The Korean minister will hold bilateral talks in the mining field with his Chinese, Chilean, Australian, Mexican counterparts, respectively to discuss issues of mutual concern.
EMM7, originally scheduled biennially, will be held this year on an annual basis to deal with oil price hikes and a stable supply of raw materials in the wake of the effects of Hurricane Katrina and spiraling crude prices.
In particular, with the OPEC secretary general participating, the APEC countries, oil consumers, will discuss the opening of a dialogue channel with the Organization of the Petroleum Exporting Countries (OPEC). Oil and mining company CEOs of the APEC countries will get together to discuss such issues as energy supply and development of the private sector.
APEC ministers are seeking to announce a communiqu' sharing an understanding of oil price hikes and a shortage of raw materials and promoting cooperation in order to have a stable supply of crude oil and raw materials.
The upcoming meetings are expected to boost Korea's diplomatic profile in energy and resources sectors.
Q: How many people will attend the meetings and who will be the VIPs participating?
A: About 200 people, including energy and mining ministers from 21 APEC member countries and vice ministers, the OPEC secretary general and energy company CEOs will be present at EMM7 and MRM2.
Ministers and mister-level ranking officials expected to participate in EMM7 are from Australia, China, Indonesia, Japan, Mexico and Thailand. Such countries as Australia, Chile, Indonesia and Japan will send mining ministers and minister-level delegates to MRM2. Some APEC ministers have separate energy and mining ministers.
Q: Would you be more specific in the schedule of the upcoming conference?
A: Senior Officials Meeting of Energy is scheduled for October 18 from 2 P.m. to 6 p.m., and EMM7 will kick off for a one-day run in the morning of October 19. OPEC-APEC Business Dialogue will be held from 11:30 a.m. to 1 p.m. on October 19, while MRM2 Business Dialogue will take place from 3 p.m. to 6 p.m. the same day.
MRM2 will be held between 9 a.m. and 5:10 p.m. on October 20. Participating delegates will embark on an industrial inspection and a tour to cultural property on October 21.
Q: Will you elaborate on the government? short-, mid- and long-term measures designed to better cope with oil price hikes?
A: The Dubai crude oil has hovered above the $50 level since July until October 6. Crude oil hikes are likely to persist, given a rising demand in petroleum consumption during the winter, oil producers' difficulty in pumping extra production and the uncertainties of the Middle East.
The government is now drawing up short-term steps designed to encourage energy conservation efforts as well as mid- and long-term measures to institute a structure of stabilizing the demand and supply of energy sources. The private sector will be asked to join energy conservation efforts on a voluntary basis. Such energy-guzzling businesses like bathhouses and department stores will be urged to sign voluntary pacts to introduce a day off system, refrain from excessive air-conditioning and indoor lighting. Mandatory reservation measures will be in place starting areas with lesser inconveniences to the public on a step-by-step manner.
In the event energy supply is disrupted and voluntary energy conservation efforts are found insufficient, 18 government ministries and other agencies are jointly working out a three-year energy unit cost improvement plan, calling for implementing 88 tasks in the industry, transportation, household/merchant sectors with the goal of raising energy efficiency by 8.6 percent in the next three years conserving 17.6 million of TOEs worth some 4.8 trillion won during the period between 2005 and 2007.
The government will step up energy summit discussions, foster companies specializing in the development of energy sources and reinforce supports for the private sector to step on the gas the capability to explore energy sources abroad. Among a few representative success stories of foreign oil exploration and development projects are the awarding last August of a Korean consortium with the right to explore two mining zones with estimated reserves of 2 billion barrels in Nigeria and Korea National Petroleum Corp.'s additional discovery of oil in the 15-1 mining zone with estimated deposits of 120 million barrels.
It plans to expand investments into the development of new and renewable energy sources with the goal of raising the percentage of new and renewable energy sources from 2.3 percent in 2004 to 5 percent in 2011. The government budget earmarked for the development of new and renewable energy sources has risen from 196.4 billion won in 2004 to 325.9 billion won in 2005.
The government plans to raise the amount of petroleum stockpiling in the case of emergency from 149.1 million barrels or 115 days of oil consumption and the capacity of stockpiling. The dedication of the Seosan petroleum stockpiling complex brought to more than 100 million barrels Korea's petroleum stockpile capacity.
Q: Would you explain Korea's efforts to explore energy resources abroad, achievements and strategy for the development of energy resources?
A: Korea depends on foreign imports for 97 percent of its total energy consumption, securing a stable supply of energy is a national task. Designating the development of energy resources in foreign countries as one of national agendas, the government has convened the National Energy Consultation Conference, presided over by the Chief Executive, to lay the groundwork on the energy sector. The conference has been held for the third time so far to delve into the issue of foreign energy resource development.
Korea's efforts to develop energy resources in foreign countries suffered a setback due to the Asian financial crisis in 1997, but they have gained momentum thanks to summit talks, government support and the private sector? strategic participation in foreign every resource development projects that have begun to bear fruit.
Korea's investments into foreign petroleum development projects surged from $370 million in 2001 to $670 million in 2004 and an estimated $800 million in 2005. Its own development rate of crude oil edged up from 2.0 percent in 2001 to 3.8 percent in 2004 and an estimated 4.1 percent in 2005.
In particular, Korea has been awarded with the rights to explore a mining zone with estimated deposits of 3.7 billion barrels in Western Kamchatka, Russia and another one with estimated reserves of 1.6 billion barrels in Zhambyl, Kazakhstan following last year's summit talks.
Korea recently struck oil in its petroleum development projects in Nigeria and Vietnam.
The government will continue to step up diplomatic efforts in strategic areas, expand diverse investment funds and strengthen government and the private sector's capacity to implement energy resource development projects. It will encourage Korean energy companies to strengthen their presence in foreign countries through overseas energy resources development projects by capitalizing on the experiences they have acquired from their successful simultaneous entry into foreign countries. Petroleum development funds will be introduced to back up the private sector's investments, while manpower with expertise in energy resource development will be nurtured. The government plans to overhaul Korea National Petroleum Corp. on a step-by-step basis.
Q: Would you comment on the government? new and renewable energy development projects and future plans?
A: The government is developing a policy infrastructure in terms of budgets, organization, and laws and regulations while actively pushing ahead with efforts to develop technologies and distribute them with the goal of raising the portion of new and renewable energy resources to 5 percent of the total primary energy use by 2011. The government budget for the sector increased from 119.3 billion won in 2003 to 196.4 billion won in 2004 and 234.2 billion won in 2005.
As to specific strategies, the government will focus R&D activities on arenas with a high feasibility of commercialization and industrialization development of three core arenas, hydrogen, fuel cell and solar cell power and tidal power and commercialization of such energy sources as solar heat, bioenergy and geothermal power. It plans to develop and support programs for distributing technologies in core arenas, includes the one on supplying 100,000 solar roofs, in a bid to create markets. nw

Minister of Commerce, Industry and Energy Lee Hee-beom