ABUDHABI, May 13: Opec member United Arab Emirates and South Korea signed a five-year agreement on Saturday to boost energy cooperation, which may include investments in the downstream sector.

According to the memorandum of understanding, the two countries agreed to consider possible investments in projects in logistics and distribution, supply of crude oil and petroleum products, marine transportation, petrochemicals, and construction and services.

Gulf Arab oil producers like the UAE are looking to invest in the downstream sector in Asian countries.

UAE Energy Minister Mohammed bin Dhaen al-Hamli said his country was studying a proposal by South Korea for it to help supply crude oil for its strategic stockpile.

Last December, South Korea discussed the proposal with Hamli and the head of state oil firm Abu Dhabi National Co., Yousef Omair Bin Yousef.

In September, South Korea said it would look to seal more international joint stockpiling agreements. Deputy Energy Minister Oh Young-ho had said Saudi Arabia was one of two states with which South Korea was discussing possible joint stockpiling.

Seoul already has similar deals with Algeria and Norway.

A joint oil-stockpiling deal between Opec producers and major consuming nations would give producers like those in the Gulf — located at least a month’s journey away from key markets — an easy, quick and profitable way to address any shortages.

Consumer governments would buy rights to use the oil in emergencies, enabling them to head off any sudden supply outages.—Reuters