Sole oil policy arm of government Increasing exposure to cyclical and volatile oil and gas E&P business Weak, albeit improving, competitive position in oil and gas E&P business Heavy capital spending for overseas E&P investment Ongoing government financial support The stable outlook on the ratings on KNOC reflects the outlook on Korea because we equalize the ratings on both owing to our expectation that there is an almost certain likelihood of the government providing KNOC with extraordinary support in the event it were to suffer financial distress. Equalization of the ratings would lead us to lower our ratings on KNOC if we were to lower our sovereign ratings on Korea. Also, a weakening of KNOC's role as a policy arm
