Sejong, South Korea – The first exploration drilling for the 'Great Whale' gas field, which began on December 20th of last year, has been deemed unprofitable. The government announced that while the initial exploration confirmed a better-than-expected oil system compared to prior predictions, it failed to discover economically viable hydrocarbon reserves.
A high-ranking official from the Ministry of Trade, Industry and Energy stated during a press briefing at the government complex in Sejong on the afternoon of the 6th that "The first drilling confirmed a high-quality reservoir, a thick cap rock, and a shale layer, but the hydrocarbons were not at a level that could secure economic viability."
He explained, "Economic viability is determined by factors such as gas saturation, reservoir conditions, and cap rock integrity. We did not find gas saturation sufficient to convert the 'Great Whale' field into a production zone. It's possible that the gas migrated elsewhere or disappeared through cracks. Currently, it's difficult to view it as an economically viable gas field."
He continued, "The 'Great Whale' exploration drilling determined the drilling location based on potential resource volume and various possibilities. While there were positive effects on the oil system and structure, we were unable to confirm hydrocarbons at a level that could secure economic viability, which is disappointing."
Regarding the possibility of additional exploration drilling for 'Great Whale', he responded, "Considering 'Great Whale' as a single connected structure, this drilling is equivalent to examining the entire structure. Based on the current results, it appears that the overall gas saturation of 'Great Whale' is not high, so the need for additional exploration is not significant."
He also mentioned that after a thorough analysis of the results from the first exploration drilling of the 'Great Whale' structure, they plan to utilize it for the East Sea deep-sea gas field development project. He added that as early as next month, they plan to begin the process of attracting investment from global companies with capital, technology, and experience.
He emphasized, "Deep-sea exploration drilling in the East Sea is important in the resource development ecosystem. South Korea imports over 500 billion dollars worth of gas annually, and if there were a domestically developed gas field, it could help the trade balance. Overseas investment is essential as a lot of resources can be投入in the process."
He further explained, "In most resource development, the probability of success in the first drilling is very low. While the results of the first drilling cannot be viewed as positive for investment, it can be used to reduce risk in future drilling. Successfully completing investment attraction is crucial."
When asked about the investment attraction method, he replied, "We have not yet divided the mining area, and we plan to maintain investment by dividing the mining area in the future. Government budget投入may vary depending on how overseas investment maintenance conditions are set, such as the ratio of profit and risk burden."
He added, "The key to the success of the East Sea deep-sea gas field project will be to create investment attraction conditions in a way that reduces exploration risk and increases the probability of success, and whether investment attraction can be successfully led. Although we did not confirm the presence of hydrocarbons this time, there are various positive aspects. Currently, we believe that successfully attracting investment will be the success momentum."
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