Gov't picks first drilling spot in East Sea resource exploration project
Industry Minister Ahn Duk-geun speaks during a meeting at KOTRA in Seocho District, Seoul. Nov. 27. Yonhap
Korea's industry ministry said Wednesday it has selected a site in the East Sea for the first drilling operation to uncover potential gas and oil reserves, with the process set to begin next month.
The decision came during a meeting with related agencies in Seoul to review progress in preparations for the exploration project in the East Sea that could potentially uncover between 3.5 billion and 14 billion barrels of gas and oil, according to the Ministry of Trade, Industry and Energy.
Korea is set to initiate the first drilling operation next month, which is expected to take around two months, with the drilling ship scheduled to arrive in the southeastern port city of Busan in mid-December.
The government plans to announce the results of the first drilling operation in the first half of next year.
"As we have taken the first step toward the full-fledged development of a deep-sea gas reserve, we should not be overly concerned about the success of the first drilling operation but continue with follow-up efforts based on the experience and information gained," Industry Minister Ahn Duk-geun said.
If confirmed, the reserves could be sufficient to meet the country's gas demand for up to 29 years and its oil demand for four years.
Costs, however, remain a major hurdle for the development project, as drilling a single hole is estimated to cost around 100 billion won to 130 billion won (71.5 million-$93 million).
In October, the Korea National Oil (KNOC) named S&P Global as the adviser for the East Sea project.
KNOC has also been holding meetings with global and domestic businesses to attract investment since July. (Yonhap)