Yoon says potentially massive oil, gas reserve could be buried off Pohang

June 3, 2024

President Yoon Suk Yeol said Monday that a potentially massive oil and gas reserve could be buried off the southeast city of Pohang and drilling will begin later this year to determine whether it is real.

The reserve off Yeongil Bay in Pohang, about 260 kilometers southeast of Seoul, could hold up to 14 billion barrels of oil and gas, an amount that could meet South Korea’s gas demands for 29 years and oil demands for four years, Yoon said.

He cited a geophysical study conducted by an unidentified foreign seismic research company.

“The recent results indicate a very high possibility of deposits amounting to 14 billion barrels of oil and gas, and these findings have been verified by leading research institutions and experts,” Yoon said during the briefing at the presidential office.

The Ministry of Trade, Industry and Energy has approved the exploration drilling plan, with preliminary results expected by the first half of next year.

The government had discovered the high likelihood of additional oil and gas fields around the gas field in the East Sea in February last year, and a leading deep-sea technology evaluation company was commissioned to conduct an in-depth geophysical survey, Yoon said.

Based on the survey results, an exploration drilling project will be launched to confirm the actual deposits, a process that typically takes at least three years before proceeding to commercial development. The government estimates that three-quarters of the reserves are gas, with the remainder being oil.

Industry Minister Ahn Duck-geun said that preparations for commercial drilling are expected to begin once the actual deposits are confirmed, expecting construction to start around 2027-2028.

“We anticipate commercial development to start around 2035, but it is difficult to specify an exact timeline until the deposits are confirmed,” Ahn said during the briefing.

Ahn explained the maximum potential deposits of 14 billion barrels are equivalent to five times the market value of Samsung Electronics Co., South Korea’s most valuable company. As of Monday, Samsung Electronics holds a market cap of 451.9 trillion won (US$328.2 billion