As the government released a plan to merge Korea Gas Corporation (KOGAS) and Korea National Oil Corporation (KNOC), attention is on whether it can clear the hurdle of labor unions. That is because the government did not coordinate in advance with the unions while preparing the merger plan. Above all, for KOGAS, it would effectively be taking on KNOC, which is in a state of complete capital erosion, and there are differences in pay and benefits between KNOC and KOGAS employees that will also need to be addressed.
According to the energy industry on the 7th, the KOGAS and KNOC unions each released a statement that day opposing the merger.
In a statement that day, the KOGAS union said, "A merger and acquisition (M&A) with KNOC, which is in a state of complete capital erosion, is unthinkable," adding, "This abnormal act is not a merger for energy security, but, contrary to the government's intent, will be a disastrous policy failure that threatens energy security."
The KOGAS union went on to say, "We oppose the hasty merger of KOGAS and KNOC," adding, "The government must first take responsibility and sort out the insolvency caused by past policy and management failures. To evade that responsibility, it must not forcibly bind together a state-run company performing normal functions and an insolvent state-run company."
The KNOC union said, "Even as the government makes an important decision on national energy security, we cannot dispel concern and suspicion about why it was released as a surprise," adding, "We are adamantly opposed because this merger plan has not only lost procedural legitimacy but is also the worst self-defeating move that would dismantle the national energy ecosystem."
The KNOC union continued, "Even accepting the government's logic, while finalizing a major reorganization plan, it did not go through a single step to gather opinions from employees of the public institutions directly involved," adding, "If it thinks that just because these are government-affiliated institutions, officials can, behind closed doors, tear apart and paste together state-run companies at will, that is a feudal practice intolerable in a democratic nation."
According to the energy industry, rumors began circulating a few months ago that a plan was being pursued to merge not only KOGAS and KNOC but also the Korea Mine Rehabilitation and Mineral Resources Corporation. The government concluded that it would merge only KOGAS and KNOC, which manage oil and natural gas with similar exploration methods, excluding the corporation that manages minerals, but most employees of both companies reportedly learned of the news through media reports.
The unions of both companies plan to decide on actions such as a strike related to the merger after discussions with their umbrella unions.
KOGAS has 4,322 employees, of whom 3,932 are eligible to join the union. KOGAS has multiple unions, and 3,652 people belong to Union No. 1, which is affiliated with the Korean Confederation of Trade Unions (KCTU). Union No. 2, which has no umbrella organization, has 280 members. KOGAS's unionization rate is 100%.
KNOC has 1,179 employees, and 1,002 are eligible to join the union. Of these, 947, or 94.5%, are union members. Its umbrella union is the Federation of Korean Trade Unions.
The unions of both companies are also likely to weigh in when reconciling differences in pay and benefits between KOGAS and KNOC. As of the end of 2025, KOGAS has a larger workforce and relatively higher pay.
As of the end of 2025, the average compensation per regular KOGAS employee is 106.088 million won. Pay-type benefits are 273,000 won, and performance bonuses are 18.474 million won. By comparison, the average compensation per regular KNOC employee is 96.598 million won, a difference of 9.49 million won. KNOC's pay-type benefits per employee are 410,000 won, and performance bonuses are 6.872 million won, it was found.