It was confirmed on the 20th that Korea National Oil Corporation (KNOC) has completed selecting the preferred negotiating party for the Deep East Sea gas field second drilling investment bid that closed on Sept. 19 and is conducting consultations and reviews with the Ministry of Trade, Industry and Energy before the announcement.
According to industry sources that day, Korea National Oil Corporation (KNOC) held an in-house evaluation meeting last week and selected British Petroleum (BP) as the preferred negotiator for the joint development of the Deep East Sea gas field.
Since March through the 19th of last month, the corporation conducted an investment attraction (equity participation) bid for offshore blocks in the East Sea, targeting promising structures other than Blue Whale. Global major resource development companies, including BP, are said to have participated in the bid.
The Deep East Sea gas field project, known as "Blue Whale," is a project to explore oil and gas resources in Block 8 and Block 6-1 within the Ulleung Basin. As a result of the first drilling conducted off the coast of Pohang on Dec. 20 last year, the Blue Whale structure was concluded to be uneconomic.
Currently, the corporation is proceeding with the consultation process with the government after completing the selection of the preferred negotiating party. After the preferred negotiating party is selected, the company notifies the firm after internal review and approval procedures. Detailed contract terms negotiations and the signing of a concession agreement are expected to follow.
At the National Assembly's Trade. Industry Energy. SMEs. and Startups Committee audit that day, Lee Jong-bae of the People Power Party said, "The preferred negotiating party was selected last week, but I understand that consultations and reviews with the Ministry of Trade, Industry and Energy are underway."
Meanwhile, at the audit, the corporation was criticized for points including: ▲ that the process and criteria for selecting Act-Geo when ordering the Ulleung Basin technical evaluation service were opaque ▲ the circumstances of canceling the Korea Institute of Geoscience and Mineral Resources (KIGAM) study reviewing seismic safety for exploratory drilling in the East Sea ▲ and that despite a conclusion that the drilling project had low economic feasibility, the responsible team and executives received top-level performance bonuses and some were even promoted.