Australia's Woodside assessed possible oil reserve site 'not prospective'

Woodside's 2023 business report announcing the exit of an oil exploration project with the Korean government [SCREEN CAPTURE]

An assessment last year by a major Australian energy group determined the east coast site believed by the Korean government to possess massive oil reserves to be unpromising, sparking further doubts over the claim.

Woodside Energy exited the exploration project with Seoul last year, mentioning that the project is “no longer considered prospective” in its 2023 business report.

“Woodside continued to optimize its exploration portfolio, exiting blocks no longer considered prospective. This included a decision to exit Block 5 in deepwater Trinidad and Tobago and completing formal exit activities in offshore Canada, the Republic of Korea, Peru and Myanmar Block A-6,” it read.

But the government rebutted that the company left because of a shift in business focus following a merger.

“Woodside exited in January 2023 after expressing the intention in July of 2022, although it held the exploration rights between February 2007 and December 2016 and resumed exercising the rights in April 2019 that was expected to last until April 2029,” the Ministry of Trade, Industry and Energy said in a statement released Thursday.

"The decision was made after a merger with BHP in June 2022 as the company adjusted its businesses that had been so far centered on global offshore projects,” it said.

President Yoon Suk Yeol announced on Monday that reserves of oil and gas — containing as many as 14 billion barrels — were likely buried in the waters around Yeongil Bay in Pohang, North Gyeongsang.

Although Woodside didn't express its stance after the announcement, its previous business report contains a statement that links the merger with the departure of the Korean project.

“Following completion of the merger with BHP’s petroleum business, Woodside took decisive action to exit our exploration positions in offshore Canada and the Republic of Korea,” Woodside’s 2022 annual business report read.

The ministry also added that the firm left before its study reached a stage at which the verification of oil and gas reserves was possible.

Following Woodside’s exit, the Korean government tapped ACT-GEO, a U.S. geoscience research and consulting firm, to continue the prospecting study.

To address the mounting questions, Vitor Abreu, founder of ACT-GEO, arrived in Korea Wednesday. He will hold a news conference in Sejong on Friday.

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]