|Seen is a graphic illustration of SK Innovation's Pearl River Mouth Basin block 17/03 in the South China Sea. / Courtesy of SK Innovation|
By Park Hyong-ki
SK Innovation has discovered oil in the Pearl River Mouth Basin (PRMB) block 17/03 in the South China Sea, the energy company said Thursday.
This marks SK Innovation's first discovery in the area since its decision to push forward with offshore oil exploration projects as an operator in the South China Sea.
Since its signing of the block 17/03 product sharing contracts (PSC) in February 2015, SK Innovation has been focusing its technical capabilities on geological and geophysical surveys.
In December 2017, it drilled its first exploration well to the depth of 2,014 meters and found a 34.8-meter net oil pay.
The oil production of the well was tested as being up to 3,750 barrels per day.
SK Innovation plans to drill follow-up appraisal wells to assess reserves and the commercial viability of the project.
SK Innovation currently holds an 80 percent working interest in the block, and 20 percent is held by CNOOC, the Chinese stated-owned company specializing in offshore oil and gas.
"SK Innovation was the first private company in Korea to step into the upstream oil and gas business, and the company's focus on technical expertise since its beginning in 1983 led to this significant milestone," its spokesperson said.
"Once the commercial viability of the project in PRMB is secured, SK Innovation will use it as a platform of growth into other areas in the South China Sea."
SK Innovation first started its oil and gas business in 1983 by acquiring interests in Karimun Block, Indonesia, and has been focused mainly on conventional oil and gas in areas such as Peru, Vietnam and in the Middle East.
In 2014, it acquired two unconventional oil and gas assets in the U.S. which currently produce around 2,500 barrels of oil equivalent per day (boepd). SK Innovation's net reserves amount to 530 million of barrels of oil equivalent (mmboe) with daily production at 55 kilobarrels of oil equivalent (kboe) from 13 blocks in 9 countries globally. In the South China Sea, SK Innovation holds operatorship (exploration) for two additional PSCs.