To Close a Business, at Least 100 Million Won Needed... Increasing Number of 'Abandoned' Gas Stations

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[Asia Economy Reporter Seoyoung Kwon] As the COVID-19 pandemic prolongs, the gas station industry is facing difficulties, and the government has expressed its intention to prepare support measures.

The Korea Gas Station Association announced today (the 10th) that as of the end of February this year, the number of gas stations nationwide was 11,331, a decrease of 184 over the past year. In particular, compared to January, about 40 stations closed within a month. The four major refinery brand gas stations?SK Energy, GS Caltex, Hyundai Oilbank, and S-Oil?totaled 9,929, which is 224 fewer than last year.

The primary cause of this change is attributed to COVID-19. Due to the government's social distancing guidelines, citizens' outings have decreased, and vehicle operation has also declined. Supporting this, the consumption of petroleum for transportation decreased by 9.6% compared to last year.

Additionally, within the industry, it is known that closing a gas station currently costs at least 100 million KRW. This is due to soil contamination cleanup and facility demolition costs. Because of this, many gas stations choose to suspend operations rather than close, even if they are not profitable. This leads to an increase in 'abandoned' gas stations that remain unused for long periods.

In response, the Ministry of Trade, Industry and Energy announced a research project titled "Gas Station Status Survey and Support Measures for Business Diversification and Innovation." The purpose is to investigate and analyze the current status of gas station operations and business diversification plans domestically to prepare industry support policies.

The Ministry stated, "Through this research project, we plan to analyze the status of gas station suspensions and closures, related cost estimations, regulations, and support systems," adding, "We also plan to review support cases for suspensions and closures in other domestic industries."

This content was produced with the assistance of AI translation services.