SEOUL Sep 20, 2006 (Dow Jones Newswires)
South Korea's LG International Corp. (001120.SE) will begin exploring an oil field in Kazakhstan with reserves estimated at 200 million barrels, the company said Wednesday in a regulatory filing to the Financial Supervisory Service. LG International holds a 50% stake in the Egizkara oil field, while the remaining 50% is shared by multinational investors, including Netherlands-based holding company Fosco, said Lee Sang-Ho, an LG International spokesman.
He didn't elaborate how much the company will invest in the project, saying it largely depends on developments of the exploration.
The field is located near the Caspian Sea.
The company plans to start drilling in the second half of 2007, with exploration starting in October 2006 and ending in December 2010.
LG International is currently involved in two other oil exploration projects in Kazakhstan - the ADA block with estimated reserves of 170 million barrels and Block 8 with reserves estimated at 250 million barrels.
The company will soon begin exploration at Block 8, adjacent to the ADA block, with SK Corp. (003600.SE), South Korea's largest refiner by capacity, in a 50-50 joint venture.
By forming a consortium with state-run Korea National Oil Corp., LG International plans to come up with a detailed development plan to produce oil from the ADA block in 2007. KNOC and LG International each have 22.5% stakes in the project.
It has discovered 20 million barrels of the estimated 170 million barrels in reserves since it began exploration of the ADA block in August.
The company is targeting earning more than 60% of its overall profits from overseas energy exploration by 2010.
Copyright (c) 2006 Dow Jones & Company, Inc.
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