Korea Customs Service to Establish Fuel Supply Base for Arctic Shipping and Trading Vessels in Busan

A foundation for supplying fuel to Arctic shipping routes and trading vessels will be established in Busan. This is part of a strategy to foster Busan as a key hub for advancing into the Arctic route.

On January 6, the Korea Customs Service announced that it will newly designate a 41,087-square-meter oil storage facility (14 oil tanks) located in Nam-gu, Busan, as a "comprehensive bonded area."

A comprehensive bonded area is a type of bonded zone designated by the Commissioner of the Korea Customs Service, where two or more functions-such as storage, exhibition, sales, manufacturing, or processing of foreign goods-can be performed while customs duties and other taxes are deferred.

Provided by Korea Customs Service

The designation of the Busan oil storage facility as a comprehensive bonded area is part of the national agenda item 56, "Building a K-Maritime Power Leading the Arctic Route Era." The main goal is to establish a stable system for supplying fuel to ships and trading vessels entering and leaving Busan via the Arctic route, thereby creating new added value.

Until now, ships at Busan Port have received marine fuel from places like Ulsan and Yeosu. This was because oil product blending was not permitted at the storage facility before it was designated as a comprehensive bonded area.

Oil product blending refers to the process of mixing two or more different oil products to manufacture a new oil product. For example, it involves mixing domestically produced low-sulfur fuel oil with domestic or international bio-based materials to reproduce eco-friendly biofuel.

However, from now on, domestic and foreign oil products can be blended at the Busan oil storage facility while customs duties and fuel taxes are deferred, making it possible to produce and supply eco-friendly marine fuel. This is expected to reduce transportation costs, shorten lead times, and attract more trading vessels and logistics to the port.

The Korea Customs Service also plans to continue working with related ministries such as the Ministry of Oceans and Fisheries to expand the designation of comprehensive bonded areas for infrastructure facilities in energy, logistics, and ports as part of nurturing Busan as a hub for the Arctic route. In addition, the agency will support the construction of icebreakers and ice-class vessels needed for pioneering the Arctic route under deferred taxation, further contributing to the development of the Arctic route.

Lee Myunggu, Commissioner of the Korea Customs Service, stated, "The designation of the Busan oil storage facility as a comprehensive bonded area will serve as a stepping stone for Busan to become a key hub for advancing into the Arctic route," and added, "The Korea Customs Service will continue to pursue regulatory innovation that companies can truly feel, based on feedback from the field."