{"id":2205341,"date":"2024-06-04T08:00:26","date_gmt":"2024-06-03T23:00:26","guid":{"rendered":"https:\/\/koreapro.org\/?p=2205341"},"modified":"2024-06-03T18:06:49","modified_gmt":"2024-06-03T09:06:49","slug":"south-koreas-potential-oil-and-gas-windfall-clouded-by-lack-of-transparency","status":"publish","type":"post","link":"https:\/\/koreapro.org\/2024\/06\/south-koreas-potential-oil-and-gas-windfall-clouded-by-lack-of-transparency\/","title":{"rendered":"South Korea\u2019s potential oil and gas windfall clouded by lack of transparency"},"content":{"rendered":"
South Korea announced the potential discovery of significant oil and gas deposits off the coast of Pohang in the East Sea on Monday. A government-commissioned study by U.S. firm Act-Geo estimated the reserves could hold 3.5 to 14 billion barrels, potentially meeting domestic gas demand for 29 years and oil demand for four years. The value is estimated at up to $1.4 trillion.<\/span><\/p>\n Exploratory drilling will begin by the end of 2023 to confirm the presence and quantity of the deposits. If successful, preparations for commercial drilling could start in 2027 or 2028, with production potentially beginning in 2035. The reserves are located within South Korea\u2019s exclusive economic zone, but foreign partners may assist with the deep-sea operations. Each drilling spot is estimated to cost over $72.6 million and has a 20% success rate.<\/span><\/p>\n Why It Matters<\/b><\/p>\n The South Korean government\u2019s announcement lacks crucial details about the project\u2019s economic impact, environmental consequences and budget. For instance, the government did not discuss the potential disruptions that drilling in the area might have on the local fishing industry or any potential impact it might have on the marine ecosystem.<\/span><\/p>\n The government\u2019s optimism about the project\u2019s potential benefits may be premature, given the high drilling costs and low success rate. Each drilling spot is estimated to cost over $72.6 million, with only a 20% chance of success. Further, the costs won\u2019t be reflected in this year\u2019s budget and will likely require a supplementary budget. Without a clear plan to mitigate risks, the announcement may lead to unrealistic expectations and public disappointment.<\/span><\/p>\n