State-run energy firms KNOC, Kores face tougher restructuring

The South Korean government should intensify belt-tightening moves on troubled state-run resource firms as concerns increase of their financial health further deteriorating, according to a task force of experts.

Among them is state-run Korea National Oil Corp. (KNOC) whose liabilities stood at 18.64 trillion won as of the end of last year, up nearly 514 billion won from 2019.

The capital base of Korea Resources Corporation (Kores), another financially troubled state-run resource firm, also eroded last year.

An independent task force of experts who made the advice noted that the state-run firms have failed in their restructuring efforts due to the pandemic and the drop in global crude prices.

The task force recommended a merger of the troubled firms to establish a new resource company.

The team also wants each company to come up with plans to rehabilitate their financial health by 2029.