Koo Ja-young, President of SK Innovation Co, South Korea’s biggest refinery, announced during his visit to Oklahoma’s gas field that his company will begin to aggressively invest in unconventional gas and oil exploration in the U.S.
“Starting from the US, the shale gas boom is spreading throughout the world,” Koo Ja-young was quoted as saying during his US visit.
“We will change our US unit to an outpost to spearhead development of unconventional energy sources like shale gas.”
In April, the Korean company’s U.S. subsidiary, SK E&P America Inc., acquired a 75-percent stake in fields located in Grant and Garfield counties (Oklahoma) and a 50-percent stake in the Crane County (Texas) gas field, in a deal worth US$360 million.
This is the first time for SK Innovation to take a controlling stake in U.S. energy assets, even though it had invested in partial stakes in five fields in Texas and Louisiana in 1997 when the company was under the government’s ownership.
Also, SK Innovation is the only South Korean refinery that produces shale gas or oil in overseas oil fields, the company said.
After horizontally drilling and fracking the company’s Oklahoma assets, it managed to increase the daily production volume from 2,500 barrels to 3,750 barrels.
“Approximately 15 percent of the crude oil and gas produced in Oklahoma is from the original rock layer, which means we are now producing shale resources,” the company explained.
Along with the output from the Texas oil block, the amount of petroleum that SK Innovation produces in the U.S. is reaching 4,500 barrels per day. Globally, SK Innovation is producing 70,000 barrels of crude oil a day in seven production sites, 15 drilling sites, and four LNG development projects in 15 countries around the world.
The fourth largest economy in Asia, South Korea lacks natural energy resources and relies on imports to meet about 97% of its energy demand.
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