North Korea's Upcoming Oil Boom

North Korea has been touting its enormous oil reserves for several years but until recently, the international oil community has ignored Pyongyang's claims as sheer propaganda and fiction.

Late last year, North Korea published veritable geological data made by North Korean and refutable Western oil engineers. Several multi-national giants (including S Korea's Daewoo and US Stanton) are eager to move in. North Korea plans to form a KEDO-like international consortium to bring up its black gold.

In early October of 1997, North Korea and Japanese promoters organized a seminar on the hydrocarbon exploration opportunities in North Korea in Tokyo. Dr. Dong R. Choi, a Korean geologist, based in Australia and a technical adviser for Petrex Co. Ltd., Tokyo, presented a summary of the massive survey logs on North Korea's oil formations.

Petrex Co. LTD is the sole agent of the Ministry of Oil Industry of North Korea. Its offices are at: 1-12-1, Imai, Chuo-ku, Chiba City 260, Japan, Tel. +81-43-265-1666, Fax. +81-43-266-1204 and 1-1-25-401, Seishin-cho, Edogawa-ku, Tokyo, Japan, Tel. & Fax. +81-3-3680-5763

4.3 Billion Barrels! - Dr. Choe

West Korea Bay, Exploration area, 18,600 sq. km

The basement made of thick carbonate rocks (5,000 m) of the Late Proterozoic and Early Paleozoic is overlain by the Mesozoic (6,000 -10,000 m) and Cenozoic (4,000 - 5,000 m) sediments. Source rocks are the Jurassic black shale (3,000 m or more), Cretaceous black shale (1,000 - 2,000 m), and pre-Mesozoic carbonates (several thousand meters) as well. Reservoir rocks are the Mesozoic-Cenozoic sandstone with high porosity and pre-Mesozoic fractured carbonate rocks. Petroleum traps are anticline, fault-sealed, buried hills and stratigraphic types.
Existing exploration data: 4,500 km of integrated geophysical surveys with grid of 2 x 4 km. Seven wells have been drilled, recovering oil and gas from several wells and hydrocarbon shows from all of the wells.

Korea East Sea, exploration area, 30,000 sq. km

Pre-Mesozoic gneiss and carbonate rocks are overlain by the Mesozoic and Cenozoic sediments, 6,000 - 7,000 m in thickness. A source rock is the Tertiary thick marine shales (1,500 to 2,000 m) and underlying Mesozoic? rocks. Reservoir rocks are Tertiary sandstone of a good reservoir physical property and fractured carbonate rocks which constitute the basement. Trap structures - anticline, fault-sealed, buried hill, facies-sealed, stratigraphic types and reefs.
Existing exploration data - Integrated geophysical surveys with a grid of 10 x 20 km throughout the basin, with a grid of 2 x 2 km over some parts. Two wells drilled, oil and gas shows found from both wells.

Miyakawa Jun - A Japanese Promoter of Korean Oil

Miyakawa Jun, a Japanese, imports North Korean books (Rainbow Trading). He is one of the Japanese minority who genuinely desire close ties with Korea. He maintains neighborly contacts with both Koreas. In view of the interest in the oil field development expressed by South Korean Chaebuls, Miyakawa gave an exclusive interview with Sisa Journal reporters on October 31, 1997 in Seoul. Subsequently Sisa Journal published a "positive" review of the bright potential of North Korean oil fields.

Miyakawa, who has an inside track in the North Korean Oil Ministry, told Sisa Journal that North Korea would not oppose S Korea's participation in its oil business and that Pyongyang desires a multi-national joint development regimen similar to that of Vietnam.

The second exploratory seminar will be held on December 3, 1997 in Tokyo, the third seminar in Australia in March of 1998, the fourth in Singapore in September of 1998 and a grand finale in Pyongyang late in 1998. Meanwhile, North Korea is stepping up oil promotions internationally.

Geophysical Surveys

The first extensive geophysical exploration was done jointly with China during 1965-1980. In 1967, North Korea conducted a joint geological study with the former USSR in the Tuman estuary. In addition, North Korean scientists conducted their own geophysical studies along the coastal seabed of the East and West Seas.

These preliminary studies indicated that further studies would be justified and North Korea employed Western oil experts:

Geco (Norway) was contracted in 1980 to survey Blocks 1, 2 and 3. Exploratory drilling was started in 1977 with some positive results.
Leeward Petroleum (Great Britain) was contracted in 1987 for exploration projects.
Taurus Petroleum (Sweden) was contracted in 1993 for exploration and performed sonic surveys in 1997.
Beach Petroleum (Australia) was contracted in 1997 for exploration works in the East Sea.

Four test wells in the West Sea (Yellow Sea) have been completed. One of them produced 430 barrels a day. North Korea believes that this area is ready for a large scale production drilling.

The East Sea (See of Japan) area is less promising due to its deeper depth and thicker dome overhangs. Some exploratory work was done near Wonsan with mixed results. However, it is believed that the entire East Sea basin, including Japanese territorial waters, is oil-bearing, and further seismic studies are planned.