13-08-08 A joint South Korean-Russian consortium has lost its operating license to explore and develop an offshore oil field in west Kamchatka in Russia.
State-run Korea National Oil Corp. (KNOC) said that Russia's government authority on mineral resources rejected a request to extend the license, citing failure by the Kamchatneftegaz (KNG) to carry out planned exploratory drilling.

The original license expired in late July. KNG is 60 % owned by Rosneft, Russia's state-owned oil company, with the KNOC-led South Korean firms holding the remaining 40 %.
Failure to comply to the license agreement was due in part to the Russian partner's inability to find a drill ship, which was only acquired this year, the report said. One reason why no drilling took place in 2007 was because the Russian government forbade foreign companies from exploring resources in areas above the 57th latitude, it said.

The agreement on the joint development of the west Kamchatka oil field was reached in 2003 on the sidelinesof a summit meeting between then South Korean President Roh Moo-hyun and his Russian counterpart, Vladimir Putin.
The oil field is located on the Kamchatka Peninsula's continental shelf and covers an area roughly two-thirds the size of South Korea.

Preliminary studies showed that up to 3.7 bn barrels of oil may be in the area, of which 1.5 bn barrels could belong to South Korean companies. If these estimates are correct, the field has enough oil to meet South Korean needs for a decade.
Seoul imported 880 mm barrels of oil in 2006.