25.09.21.Today News : South Korea’s ‘Great Whale’ Gas Field Deemed Uneconomical

South Korea’s ‘Great Whale’ Gas Field Deemed Uneconomical, Foreign Firms Step In for East Sea Exploration

📍Korea National Oil Corporation confirms lack of economic viability… Next year’s budget cut to zero, but foreign bidders keep project hopes alive

The so-called “Great Whale Project,” launched by the Yoon Suk-yeol administration as a flagship initiative for energy security, has officially failed due to lack of economic viability. The Korea National Oil Corporation (KNOC) confirmed there will be no further drilling in the structure. However, with multiple foreign companies bidding for exploration rights in other promising East Sea blocks, the project’s continuity is now dependent on overseas investment.

The Yoon Suk-yeol administration's ‘Great Whale Project’ ultimately failed due to insufficient economic viability.

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■ Final verdict: No economic viability in the “Great Whale”
On the 21st, KNOC announced that the “Great Whale” structure spanning East Sea blocks 8 and 6-1 has been confirmed to lack economic feasibility.
The conclusion was based on a 47-day drilling operation conducted between December 2023 and February 2024, followed by six months of detailed analysis by U.S.-based Core Laboratories.
The analysis showed that while geological features such as sandstone and caprock were relatively sound, gas saturation was only 6.3%—about one-tenth of initial expectations. No clear evidence of a trapping structure capable of storing gas was found, making commercial development unviable.

■ From high hopes to disappointment
The project began in June 2024 when then-President Yoon Suk-yeol unexpectedly declared that vast reserves of oil and gas could be lying beneath the East Sea near Pohang’s Yeongil Bay.
At the time, the government cited a report by U.S. consultancy Act-Geo that suggested 3.5 to 14 billion barrels of hydrocarbons might be buried in the area. Officials even compared the potential value to “five times Samsung Electronics’ market capitalization.”
Yet within just a year, the “Great Whale” was deemed unviable, raising criticism that the government prematurely inflated expectations for political purposes.

■ Foreign bidders keep exploration alive
While the “Great Whale” will not move forward, KNOC confirmed that exploration of four other East Sea blocks—8NE, 8/6-1W, 6-1E, and 6-1S—will proceed with foreign partners.
Eligibility for bidding was limited to firms with deepwater production of at least 100,000 barrels per day or recent cooperation with KNOC. Multiple foreign companies submitted proposals, while no domestic firms participated.
Industry observers suggest that major global players such as ExxonMobil may have joined the bidding. KNOC plans to evaluate proposals with the help of S&P Global and designate a preferred bidder before moving on to joint venture agreements.

■ Zero budget for 2025, reliance on foreign capital
The South Korean government has cut the 2025 budget for East Sea gas exploration to zero. As a result, future drilling and development will depend entirely on foreign investment.
Experts warn that excessive reliance on overseas capital could weaken South Korea’s position in profit sharing and technology independence. However, others argue that given the lack of domestic interest, foreign partnership is the only realistic path forward.

■ What lies ahead
KNOC stated it will use data collected from the “Great Whale” drilling to guide future exploration of other promising structures. Still, critics argue that the government must take responsibility for rushing into a politically driven project that ultimately collapsed.
If foreign partnerships succeed, East Sea exploration could regain momentum. But without broader domestic industry participation, long-term energy security planning, and transparent policymaking, experts caution that South Korea risks repeating the same mistakes.

One-line summary : The “Great Whale Project” was declared uneconomical and scrapped, but foreign investment is keeping East Sea gas exploration alive.