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South Korea approves huge offshore oil and gas exploration initiative

South Korea, one of the world’s largest energy importers, has announced the initiation of an offshore exploratory drilling program to uncover potentially vast oil and gas reserves.

President Yoon Suk Yeol authorized the commencement of searches off the country’s east coast on Monday, with discoveries anticipated by 2025, according to CNBC. Commercial production is slated to begin in 2035.

During a press conference, Yoon highlighted a peer-reviewed industry study indicating a “very high” possibility of the East Sea area containing up to 14 billion barrels of oil and gas. The project, estimated to cost over $363 million (500 billion won), is set to commence before the year’s end.

A government official noted that approximately 75% of the area under assessment is believed to contain natural gas, with the remainder holding oil. Pohang, a southeastern industrial port city, will serve as the operations hub.

Yoon mentioned that South Korea has conducted a series of explorations since 1996, including tapping into a gas reserve completed in 2021, yielding 4.5 million barrels. The potential new reserve is projected to be over 300 times larger than the diminishing Donghae gas field.

If fully developed, these new exploration areas could supply South Korea with power for nearly 30 years, Yoon added. As the fourth-largest buyer of crude and gas globally, South Korea heavily relies on imports, making this discovery particularly significant.

The Korea National Oil Corporation (KNOC) will lead the drilling and exploration efforts, potentially requiring up to ten wells to determine the reserve’s scope. As one of the world’s largest energy consumers, South Korea imports almost all of its oil and natural gas, being the second-largest LNG importer and the fifth-largest oil importer according to OECD data.

This major offshore exploration initiative marks a significant step for South Korea in securing its energy future.

 

 

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