[Click eStock] "Donghae Oil and Gas Field, Some Benefits for Gas and Oil Public Enterprises"

The Ministry of Trade, Industry and Energy (MOTIE) has approved the exploration drilling plan for domestic deep-sea oil and gas fields. The exploration drilling plan for domestic deep-sea oil and gas fields will begin the first drilling by the end of this year. Drilling is planned until 2026. The estimated exploration resource volume (undiscovered original oil in place) confirmed by physical surveys ranges from a minimum of 3.5 billion barrels to a maximum of 14 billion barrels.

Hana Securities stated on the 4th that, assuming successful exploration drilling, gas and oil public enterprises are expected to benefit from investments in supply infrastructure. However, it advised that it is still too early to determine the extent of the benefits.

Researcher Yoo Jae-sun of Hana Securities explained, "Domestic natural gas wholesale operators will join at the final investment stage," adding, "Only investments related to importation will impact performance." He continued, "Depending on the distance and development status, transportation methods will be decided by pipeline or maritime routes," and added, "Once investment costs increase, the tariff floor will also rise, which will positively affect business performance."

Researcher Yoo analyzed, "Import prices will be determined conditionally," and "Because they vary depending on several variables such as investment costs and recovery rates, it is difficult to estimate at this point even on the premise that development will occur." He noted, "In the past, the government disclosed that the selling price of the East Sea gas field was lower than the average import price of natural gas," and said, "It is necessary to consider oil prices and exchange rates comprehensively."