KNOC signs drillship contract with Norway-based Seadrill

The photo shows a gas production facility of Donghae-1 gas field in the East Sea, where Korea first began production in 2004 and ended production in 2021. Courtesy of Korea National Oil Corp.

Korea's state-run Korea National Oil Corp. (KNOC) signed a contract with Norway-based Seadrill, an offshore drilling company, last month before an announcement of the potential discovery of offshore gas and oil reserves off the nation's east coast, according to Seadrill on Tuesday.

Seadrill said last month that its drilling ship, the West Capella, has secured "one-well contract in Korea, with an estimated duration of 40 days, valued at approximately $32 million."

The company added that the contract is expected to start in December 2024.

The West Capella is a ship built by Korean shipbuilder Samsung Heavy Industries in 2008.

On the previous day, President Yoon Suk Yeol said that Korea will push to embark on an oil and gas exploration project in the East Sea after a study suggested significant oil deposits may be buried in the deep sea off the coast of Yeongil Bay in Pohang, about 260 kilometers southeast of Seoul.

If confirmed, the quantity would be theoretically sufficient to meet the country's gas and oil demand for up to 29 years and four years, respectively.

The industry ministry noted that drilling one spot would cost around 100 billion won ($72.6 million), with an expected success rate of around 20 percent. (Yonhap)