Sean Chung’s Special Interview with Energy Business Newspaper 

Translation of an interview with Sean Chung, President and Lead Country Manager, ExxonMobil Korea Inc. (“ExxonMobil Korea”); Energy Business Newspaper, 24^th May 2019, by Youn-sook Kim, Senior Reporter, EKN

Click here for the original interview in Korean: http://m.ekn.kr/section_view.html?no=433846

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Ramping up efforts between Korea and the US to develop innovative energy and foster expert talent

 

EKN 30th Anniversary / Special Interview: Sean Chung, President and Lead Country Manager, ExxonMobil Korea

In 1986, Pyeongtaek LNG Terminal welcomed the first liquefied natural gas (LNG) cargo imported to Korea's LNG terminal from Indonesia – marking a historic moment in Korea’s natural gas industry, with multinational oil company ExxonMobil^[1] as the first company to supply LNG in Korea through the Korea Gas Corporation (KOGAS).

ExxonMobil’s first business in Korea began with lubricants in 1973, followed by a separate corporate body for chemical products established four years later. ExxonMobil Korea Inc.^[2], in charge of the LNG businesses, was established in 1983 - the same year KOGAS was founded. For 45 years, ExxonMobil has had a continuous business presence in Korea ranging from LNG to offshore construction to lubricants and chemicals. Currently, ExxonMobil LNG projects account for 25% of entire domestic demands.

In February, Korean-American Sean Chung was appointed President and Lead Country Manager for ExxonMobil Korea Inc, and currently oversees the company’s core businesses in Korea including LNG, lubricants and chemicals. Prior to Korea, Chung served in leadership roles in diverse postings including Singapore, Indonesia and Vietnam. Starting at the Mobil U.S. HQ, Chung has accumulated 25 years at ExxonMobil, with an expertise of specializing in natural gas business development, design and negotiations. Before his current position, Chung served as Vice President of ExxonMobil’s exploration and production operation in Vietnam.

“As a Korean-American, I feel deeply about contributing to the growth of Korea’s energy industry,” said Sean Chung during this interview on May 21 at ExxonMobil’s Korea office, “with the aim of creating more value for the LNG industry value chain, which then will be enjoyed by local companies as well.”

Using ExxonMobil’s LNG expertise, Chung is seeking opportunities for mutual LNG business development and collaboration in Korea as well as countries around the world, at the same time focusing on the will to maintain the long-term, strategic partnership with its largest local customer KOGAS. He is also planning a more strategic approach to the company’s Corporate Social Responsibility (CSR) activities in Korea.

Chung has a lot of tasks on his hands and many people to meet moving forward in order to fully understand what will truly ‘contribute to the growth of the energy industry.’ Having just marked his 100th day, Chung has a lot to look forward to.

 

The following is a Q&A with Sean Chung, President and Lead Country Manager, ExxonMobil Korea.

Q. It has been 100 days since you took the post. What are your thoughts?

"I came back to Korea after 40 years to take the post at ExxonMobil Korea in February. I'm filled with emotion to be back in Korea, I left the country when I was in the 2nd grade of middle school. I am eager to carry out meaningful work. I am truly glad to start working in Korea."

Q. How would you describe the role of ExxonMobil Korea in the local market?

"That’s a very important question. Above all, our role is to contribute to the various energy needs generated in Korea. ExxonMobil Korea will continue to spur efforts to competently provide a stable supply of cleaner energy, as we have been doing in the local market.

We specifically hope to take on the role as a bridge for local companies such as KOGAS to participate in diverse foreign projects led by ExxonMobil. ExxonMobil Korea has a full understanding of both the local and U.S. markets, allowing a win-win situation for companies from both countries. We aim to create a bigger LNG value chain by increasing market value based on cooperation and carrying out business on a large scale and with shared vision. In addition, we plan to cooperate on projects across companies in both private and public sectors for energy technology development. 

ExxonMobil Korea is an organization which has to maintain its existing LNG business as well as develop and pioneer new markets. In particular, Korea is a saturated market with expert buyers such as KOGAS. Accordingly, ExxonMobil must constantly lead efforts to provide greater value to clients by going beyond the role as a provider who simply participates in bids.

We are continuously cooperating with stakeholders to develop best practices and to apply them to LNG operations across the whole value chain from Upstream gas production to LNG infrastructure (liquefaction and regasification).

In this regard, ExxonMobil Korea plans to focus on creating added value to industry with its technology-focused activities. On accomplishing value creation, we plan to share the value with members within the value chain with the aim of ensuring a mutually beneficial win-win effect.

We can apply different technologies to other businesses that ExxonMobil is operating in the local market - such as the lubricants and chemicals businesses - although they are smaller than LNG in business size. For each party to achieve the ‘win-win’, we consider it necessary to have a full and deep understanding of customer demands - taking the local energy industry, economy and political environment into consideration. All of these efforts are part of ExxonMobil Korea's role and we will do our best to accomplish these goals."

Q. What kind of cooperation projects have been carried out between ExxonMobil Korea and local companies so far?

"In 2015, ExxonMobil’s Upstream Research Company, Korea Energy Technology Evaluation and Planning (KETEP) and KOGAS signed the 'Korea-U.S. Gas Industry Technology R&D Cooperation Agreement'. We are cooperating in diverse sectors such as developing new areas for mutual benefits, joint research projects, holding joint academic activities and reinforcing networks across public and private sectors with a focus on four industries, including LNG-related technology. Moving forward, we plan to lead efforts across the gas industry transaction between Korea and the U.S., with the aim of fostering professional talent and reinforcing energy efficiency by building a cooperative relationship for the development of innovative energy technology.

Q. With ExxonMobil and KOGAS jointly participating in the Mozambique gas field project, competition for business initiatives is expected to heat up, especially as Total recently announced a bid to join. Can you share your outlook on this?

"ExxonMobil and Total, both major multinational companies, expect a range of challenges when spearheading a new business, especially in the process of coordination. However, we are confident that we can overcome such difficulties. In addition, we would like to thank KOGAS for providing huge support for ExxonMobil to participate in the Mozambique's Area 4 business."

Q. Having worked in the natural gas industry for 25 years, what is your assessment of the role and vision of natural gas in the global energy market?

“According to ExxonMobil’s annual Outlook for Energy, global energy needs will likely increase nearly 25% by 2040, with natural gas accounting for the highest demand increase among the energy mix. A shift to less carbon-intensive sources of energy will contribute to a nearly 45 percent decline in the carbon intensity. In this sense, I believe natural gas will continue to serve as a crucial energy source.

Of course, demands for renewable energy will also grow, yet natural gas is a source that can complement the intermittency of renewable energy, which means the two can form a good partnership.

From now on, energy suppliers will increasingly consider environmental challenges, including impacts on climate change. The energy industry will move towards providing solutions to customers to address problems related to energy and the environment, reducing greenhouse gas emissions and aiming to develop scalable technologies. ExxonMobil takes an active role, including seeking new solutions to deal with changes in the environment."

Q. Many say the current global LNG market is biased towards the buyers. When will we see change in this market pattern?

"We have no other way but to consider the laws of supply and demand. Since there currently exist multiple providers in the market, it could be seen as a buyer’s market. However, LNG supply will not increase indefinitely. When the time comes to reduce supply, the market is likely to go through another cycle. To estimate the transition period of the market is at the discretion of each party."

Q. How do you see energy transition policy of Korea?

"Policymaking is the unique right of each country. One thing for sure is that natural gas is likely to play a crucial role. Natural gas is crucial when it comes to finding an energy solution capable of providing economic feasibility, environmental benefits, and stability altogether.”

Q. Is there an ongoing negotiation for a LNG supply contract with direct import operators in Korea as well?

"Of course. We are currently targeting various buyers for businesses. Direct imports of natural gas are one of the Korean government’s policies, which is the reason why we carry forward the business, open to all players in the market."

Q. Why do you think introduction of ExxonMobil LNG is important to local companies? 

"In terms of stable supply of energy, cooperation between Korea and the U.S. is crucial. It is important to lead various projects that are related to the introduction of U.S.-based LNG and having ExxonMobil present in the local market provides stability and competency. We consider that we can contribute to the relationship between Korea and the U.S. via cooperation on LNG supply."

Q. Any future plans?

"ExxonMobil provided the first LNG cargo in Korea. It started with 3.3 million tons in size per year and has expanded to 10 million tons, (including supplies from Qatar). We have also focused on sharing our plant technology and operation know-how to Korea. Drawing on the advanced security management system of ExxonMobil, KOGAS has implemented the EHSQ (Environment, Health, Safety & Quality) management system to the safety management on-site since 2002. We have maintained a long-lasting relationship based on such cooperation and we plan to do so in the future as well. 

In particular, we plan to step closer to the Korean society by implementing diverse CSR activities in a systematic and continued manner. We hope to look closer into the energy-deprived local communities and will seek various means through which we can contribute to Korea’s energy industry. So please look forward to it."