Detailed Analysis of Blue Whale Structure Drilling Confirms Lack of Economic Viability
Preferred Negotiating Partner to Be Selected After Bid Evaluation and Internal Procedures
Korea National Oil Corporation (President Kim Dongseob) closed the bidding for equity participation in the East Sea offshore block investment attraction at 3:00 p.m. on September 19, and confirmed through the bid opening that multiple foreign companies participated in the bidding.
The corporation launched the bidding for investment attraction in the East Sea offshore block in March, and extended the bidding period by three months in response to requests from potential investors for more time.
With the bidding now closed, Korea National Oil Corporation plans to conduct a thorough evaluation of the bids and proposals through its investment advisor, S&P Global, and will select a preferred negotiating partner if a suitable investor is identified.
If a preferred negotiating partner is selected, the corporation will proceed with negotiations on detailed contract terms and the signing of a joint exploration right agreement. However, at this stage, specific information about the participating companies cannot be disclosed in order to ensure a fair evaluation process.
Korea National Oil Corporation conducted a detailed analysis over approximately six months (from late February to late August) of samples obtained from the drilling of the Blue Whale structure, one of the promising formations, through a specialized company, Core Laboratories.
According to the detailed analysis, the subsurface properties of the sandstone layer (about 70 meters), cap rock (about 270 meters), and porosity (about 31%) were generally found to be favorable. However, as no recoverable gas was discovered, it was ultimately confirmed that the Blue Whale structure is not economically viable.
Accordingly, there are no plans to pursue further exploration of the Blue Whale structure in the future.
Korea National Oil Corporation stated that, based on the data accumulated from previous exploration and this drilling, it plans to establish new business plans, including prospect evaluation and exploration, together with joint exploration right holders if investment attraction is successful, and will do its utmost to contribute to the nation's resource security.
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