Key Point: Imagine Kim as an energy tycoon?
The “hermit kingdom” of North Korea has struggled to feed its own people in recent years, let alone sustain its energy needs. Yet with reports emerging of the hard-line Communist state’s potential oil and gas resources, South Korea and other U.S. allies in the region may soon face a far more capable military adversary.
Writing in the petroleum geoscience publication GEOExPro, exploration consultant Mike Rego suggests that the secretive Asian state offers “good hydrocarbon potential, both on and offshore…for those who are prepared to take ‘first mover advantage’ the rewards are there to be had.”
Rego points to the “relatively low cost and low risk exploration opportunities in a low competition environment, with nearby energy-hungry markets” as adding to the exploration potential.
North Korea is currently reliant on Chinese and Russian fuel imports, which Rego considers surprising given the “abundant evidence for the presence of working hydrocarbon systems both onshore and offshore, and past exploration efforts dating back to the 1970s.”
The state reportedly has seven underexplored geological basins, with three basins said to have “proven working petroleum systems,” although only twenty-two wells have been drilled.
Rego identifies the offshore West Korea Bay Basin and East Sea Basin, along with five onshore basins as offering exploration potential. According to Rego, the West Korea Bay Basin has seen the most foreign involvement, principally Chinese and Russian. At least ten exploration wells have been drilled in the West Sea, with some showing “good oil shows” along with the identification of a number of potential reservoirs.
Meanwhile, the East Sea has seen Russian exploration efforts previously including the drilling of two wells, “both of which encountered encouraging shows of oil and gas.”