[Featured Stock] Korea Gas Corporation Secures Natural Gas Value Chain Capabilities... 5%↑ on Revaluation Expectations

The stock price of Korea Gas Corporation is on the rise. Expectations that the growth potential of the natural gas value chain owned by Korea Gas Corporation will become visible seem to be influencing the stock price through a revaluation of its valuation.

[Image source=Yonhap News]

As of 9:53 a.m. on the 17th, Korea Gas Corporation is trading at 54,800 KRW, up 5.79% from the previous day.

Recently, the government announced that there is a high possibility of petroleum gas reserves ranging from at least 3.5 billion barrels to a maximum of 14 billion barrels in the deep sea area over 1 kilometer deep near Yeongilman, Pohang, Gyeongbuk. The estimated ratio of the reserves is 75% gas and 25% oil.

In response, Lee Sang-heon, a researcher at Hi Investment & Securities, explained, "Regarding the East Sea deep-sea gas field, actual reserves will be confirmed through exploratory drilling in the future." He added, "After exploratory drilling, appraisal drilling will be conducted to confirm the presence of oil and gas within the structure, followed by evaluation drilling to determine the reserves." He further stated, "If the actual reserves are confirmed smoothly, construction is expected to start around 2028, with commercial production beginning in 2035." He analyzed, "Above all, Korea Gas Corporation has secured capabilities across the entire natural gas value chain, including exploration and development, so it is highly likely to participate in the East Sea deep-sea gas field project in some form."

He continued, "If the growth potential of the natural gas value chain becomes visible, the valuation could be re-rated." He also added, "Furthermore, as the recent liquefied natural gas (LNG) price levels remain stable, it is expected that the reduction of unpaid receivables will become visible in the second half of this year through reflection in city gas tariff calculations for the recovery of unpaid amounts. This could enable the resumption of dividends."