The recklessness of the Great Whale Project
Published: 07 Feb. 2025, 00:00
The Great Whale Project, a gas field development initiative in the East Sea, has been deemed economically unviable. Vice Minister of Trade, Industry and Energy Choi Nam-ho stated, “We confirmed some signs of gas during drilling, but the scale is not significant.” This effectively means that there is not enough hydrocarbon to justify further exploration, rendering the project virtually defunct.
What is particularly unsettling is the government’s admission that the likelihood of discovering a viable oil reserve was slim from the outset. Choi acknowledged, “The initial announcement in June last year was influenced by political considerations that we had not fully anticipated. Although unintended, we regret the outcome.” While the exact nature of these “political considerations” remains undisclosed, the acknowledgment that the project proceeded despite low expectations for oil discovery calls for a thorough investigation.
The project raised eyebrows from the start. Historically, oil exploration in Korea has repeatedly ended in failure. The Ulsan offshore continental shelf did yield a gas field, allowing Korea to briefly hold oil-producing nation status from 2004 to 2021. However, the economic viability of these ventures remained weak. Although the Yoon administration initiated the exploration of seven promising structures in the East Sea in June last year, the likelihood of success was always slim.
Public skepticism mounted when President Yoon personally announced the project during a government briefing. Accompanying him, then-Minister of Trade, Industry and Energy Ahn Duk-geun heightened expectations by declaring, “The estimated reserves stand at 14 billion barrels, five times the market capitalization of Samsung Electronics.” This ignited a wave of national optimism, reminiscent of Norway’s transformation following its North Sea oil discoveries.
Further complicating the matter was the ambiguity surrounding ActGeo, the U.S.-based deep-sea exploration firm responsible for evaluating the project’s feasibility. While ActGeo’s CEO reportedly had a background in oil exploration, there was no clear evidence of the company’s successful track record in actual oil development. Nevertheless, on Feb. 2, ActGeo published yet another report, this time claiming that up to 5.17 billion barrels of gas and oil might be buried in the East Sea’s Ulleung Basin, specifically in the “Shark Demon” structure, at the request of the Korea National Oil Corporation.
The most pressing concern now is the risk of a “boy who cried wolf” syndrome. Korea has a history of resource development misadventures, notably during the Lee Myung-bak administration, when hasty and ill-conceived overseas investments resulted in substantial financial losses. If the government continues making unverified claims about oil deposits only to retract them later, future domestic and international resource exploration projects will face credibility issues. While exploration efforts should continue, the political maneuvering behind the Great Whale Project must be fully disclosed to prevent reckless development initiatives in the future.
Translated using generative AI and edited by Korea JoongAng Daily staff.
What is particularly unsettling is the government’s admission that the likelihood of discovering a viable oil reserve was slim from the outset. Choi acknowledged, “The initial announcement in June last year was influenced by political considerations that we had not fully anticipated. Although unintended, we regret the outcome.” While the exact nature of these “political considerations” remains undisclosed, the acknowledgment that the project proceeded despite low expectations for oil discovery calls for a thorough investigation.
The project raised eyebrows from the start. Historically, oil exploration in Korea has repeatedly ended in failure. The Ulsan offshore continental shelf did yield a gas field, allowing Korea to briefly hold oil-producing nation status from 2004 to 2021. However, the economic viability of these ventures remained weak. Although the Yoon administration initiated the exploration of seven promising structures in the East Sea in June last year, the likelihood of success was always slim.
Public skepticism mounted when President Yoon personally announced the project during a government briefing. Accompanying him, then-Minister of Trade, Industry and Energy Ahn Duk-geun heightened expectations by declaring, “The estimated reserves stand at 14 billion barrels, five times the market capitalization of Samsung Electronics.” This ignited a wave of national optimism, reminiscent of Norway’s transformation following its North Sea oil discoveries.
Further complicating the matter was the ambiguity surrounding ActGeo, the U.S.-based deep-sea exploration firm responsible for evaluating the project’s feasibility. While ActGeo’s CEO reportedly had a background in oil exploration, there was no clear evidence of the company’s successful track record in actual oil development. Nevertheless, on Feb. 2, ActGeo published yet another report, this time claiming that up to 5.17 billion barrels of gas and oil might be buried in the East Sea’s Ulleung Basin, specifically in the “Shark Demon” structure, at the request of the Korea National Oil Corporation.
The most pressing concern now is the risk of a “boy who cried wolf” syndrome. Korea has a history of resource development misadventures, notably during the Lee Myung-bak administration, when hasty and ill-conceived overseas investments resulted in substantial financial losses. If the government continues making unverified claims about oil deposits only to retract them later, future domestic and international resource exploration projects will face credibility issues. While exploration efforts should continue, the political maneuvering behind the Great Whale Project must be fully disclosed to prevent reckless development initiatives in the future.
Translated using generative AI and edited by Korea JoongAng Daily staff.
with the Korea JoongAng Daily
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