The government has decided to determine the first drilling location for the 'East Sea Deepwater Gas Field Development Project,' scheduled for December this year, within next month. Additionally, based on promising structures estimated to contain large quantities of oil and gas, the government plans to reconfigure the blocks in the East Sea area. Through this, the government aims to promote efficient investment attraction and development of the deepwater gas fields.
Choi Nam-ho, Vice Minister of the Ministry of Trade, Industry and Energy, stated at the Government Complex Sejong on the 10th, "If we work backward from the plan to drill around the end of December this year, the exact drilling location must be decided by July to maintain the subsequent schedule. Currently, contracts related to physical logging, such as for drillships and supply vessels, have already been signed."
Choi Nam-ho, Vice Minister of the Ministry of Trade, Industry and Energy, is giving a briefing on the 'East Sea Deep Sea Gas Field Development' at the Government Complex Sejong on the 10th.
The drilling operation is expected to take about three months. Vice Minister Choi explained, "It takes about 15 days for the drillship located in Indonesia to arrive at the site, and the main drilling operation will last about 40 days. Considering that it takes about 10 days to refill after excavation, the entire process will take roughly three months." He added, "Assuming that the data obtained from the drilling operation will be reviewed for about three months, the first drilling results are expected to be available around the first half of next year."
The Ministry of Trade, Industry and Energy plans to hold a strategic meeting on the East Sea deepwater gas field development next month to review preparations related to drilling and discuss future directions for attracting overseas investment. At this time, the government will also reconfigure the blocks considering the seven promising structures identified for efficient investment attraction and development.
Vice Minister Choi explained, "The seven promising structure areas identified this time span across several parts of the existing blocks. We plan to re-divide the blocks considering the structures of these seven promising sites."
Currently, the East Sea deepwater area is divided into three zones: Block 8, Block 6-1 Northern, and Block 6-1 Central-Eastern. Vice Minister Choi said, "The blocks set before identifying the promising structures were not optimized for investment attraction and development. The division of blocks is important because future investment attraction and exploration will basically be centered on these divided blocks."
To this end, Korea National Oil Corporation (KNOC) will temporarily return the East Sea deepwater blocks, in which it currently holds 100% equity, to the government. The government plans to grant new block development rights to KNOC according to the distribution of promising structures.
Vice Minister Choi stated, "Regarding overseas investment attraction, since negotiations are necessary, I cannot provide specific details, but multiple companies have shown interest. We will promote phased investment attraction by the reconfigured blocks, differentiating foreign equity participation, participation levels, and timing."
Alongside this, the government will also pursue institutional improvements to attract overseas investment. Vice Minister Choi said, "In other countries, there are systems such as the 'Signing Bonus,' which requires bidders to offer additional bonuses upon signing block contracts, and the 'Production Bonus,' which provides bonuses to the country based on initial production. Korea does not have these. Also, regarding sales, the current Submarine Mineral Resources Development Act assumes existing East Sea gas fields and allows sales only domestically or in limited areas, so this part also needs comprehensive revision."
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