South Korea, which is the world's fifth largest importer of crude, is also a big buyer of condensate, a super light oil that can be processed into fuels and petrochemicals. Iran's return would help ease tight condensate supply in a market dominated by fellow OPEC producer Qatar, Reuters reported on Wednesday.
"We will increase oil and natural gas (liquids) imports from Iran, especially Iranian condensate," South Korea's Trade and Energy Ministry said on Tuesday.
Iran is exporting 100,000 barrels of oil a day to South Korea, one of its main crude customers, and hopes to double that figure by the end of 2016, Oil Minister Bijan Namdar Zanganeh was quoted as saying on Monday.
On January 17, the Islamic Republic emerged from years of economic sanctions.
That encouraged a tripling of South Korea's oil imports from Iran in January, but shipments remained far below pre-sanction levels.
South Korea's Trade Ministry said the two countries would establish a payment system to facilitate smooth trade of crude and condensate between National Iranian Oil Company and South Korea's SK Energy and Hyundai Oilbank.
South Korea's condensate demand is expected to grow this year as Hyundai Oilbank will begin operations at a new splitter.
Hanwha Total Petrochemicals, another South Korean condensate buyer, is considering whether to resume imports from Iran from April, a company spokesman said.
He added that the company would have to see if Iranian condensate fits well at their plant before they sign a term contract.
South Korea also expects to sign a memorandum of understanding with Iran to lease out oil storage facilities in the North Asian country, the South Korean Trade Ministry said.
Asia's fourth-largest economy currently operates nine oil storage facilities, capable of holding 146 million barrels, according to Korea National Oil Corp's website.