Korea National Oil Corp. has focused on the exploration of non-traditional energy resources that can be extricated from large boulders and sands such as shale oil, shale gas, and super heavy oil to replace traditional fossil fuels, the state-run oil company said recently.

The cost for the exploration of non-traditional fuels has been very high, but the development of new technologies has made it more economical and many oil companies around the world have kicked off projects to explore non-traditional energy sources and KNOC has been no exception, the company said.  

KNOC kicked off its plan to pursue the exploration of non-traditional energy by taking over a 23.67 percent stake in the Eagle Ford Shale Oil Production Mining Bloc from Anadarko Petroleum Corp. of the United States in April for $1.55 billion.

The oil bloc is located in the Maverick basin in Texas with more than 491 million barrels of shale oil in reserves. KNOC officials said the oil bloc produces 70,000 barrels of shale oil daily and could produce up to 323,000 barrels daily by 2016, which could be a major growth engine for KNOC if that projection is realized.

KNOC plans to dispatch a number of personnel to the shale oil district as spelled out in the takeover agreement in order to train its own personnel in such key operational areas as the development, production, and marketing of shale oil so that they can take over those key roles when KNOC starts work on new shale oil exploration in other oil blocs around the world.

The state-run oil company has been speeding up its plans to take over oil and gas exploration districts. In 2009, the company took over Harvest Oil in Canada followed by Dana Oil in Britain in 2010 to expand its oil exploration operations to the United States, Russia’s North Sea, and Africa. The company has in its possession crude oil reserves of 240 million barrels and production of 48,000 barrels of oil daily with the take over of a stake in Dana Oil boosting the self-sufficiency ratio of Korea’s oil consumption to 20 percent.

KNOC held a 2012 strategy meeting on Jan. 26-27 for its overseas unit heads at its head office in Seoul to discuss and draw up the company’s major strategies for this year.

With 47 KNOC unit heads from 17 overseas units in 14 countries attending, the two-day meeting led by President Kang Young-won took up issues faced by each unit and issues facing the company as a whole that require immediate attention, especially those related to pushing the “Great KNOC 3020” vision, such as mid- to long-term strategies and synergy among KNOC-invested firms abroad.

The Great KNOC 3020 was announced in 2008 in line with the government policy to make KNOC greater. Under the strategy, KNOC’s daily crude oil production would reach 300,000 barrels per day and its untapped oil reserves would reach 2 billion barrels in 2012.

KNOC said its Ada oil field in Kazakhstan, which has been explored since 2009, was found to contain 11 million barrels of crude oil recently. The new discovery brought the crude oil untapped in the mining districts in the No. 5 Basenkol to 41 million barrels, boosting the economic feasibility of the mining district with the discovery of new crude oil reserves.

The company expects to find from 17 million to 42 million more barrels of oil as it continues to conduct test drilling at other sites in the same mining district, in addition to the 11 million barrels found already.