South Korea signed a deal Monday to buy a 100 percent stake in an oil sands mine in Canada that can produce 250 million barrels of oil, Yonhap News Agency reported on Monday.
It said the estimated size of the Blackgold Mine in the Cold Lake region of Alberta will allow South Korea to extract 30,000-35,000 barrels of oil per day for the next 25 years.
Hwang Doo-yul, CEO of state-run Korea National Oil Corp. (KNOC), and Geoff Waterman, vice president of Newmont Mining of Canada, signed the deal in Seoul. The Canadian company is an affiliate of U.S.-based Newmont Mining Corp., the world's largest gold producer.
The South Korean firm is expected to begin production in 2008, with full-scale operations to commence two years later. KNOC paid $270 million for the mining rights and expects annual sales to reach $500 million once full-scale production commences.
Oil sands, also referred to as tar or bituminous sands, are deposits of bitmen trapped in a mixture of clay, sand and water. They are in essence sand or sandstone containing at least 10 percent petroleum.
There are estimated to be 175 billion barrels of petroleum that can be extracted from oil sands mines around the world, with Canada having the world's second-largest reserve of oil sands after Venezuela.
Canada, which has most of its oil sands mines in the Peace River, Cold Lake and Athabasca regions of Alberta, can churn out 4.7 billion barrels of oil on an annual basis.
The ministry said once production begins, the country's oil output self-sufficiency level could be raised by around 1.2 percent.
South Korea currently produces 115,000 barrels of oil daily from local and overseas oil fields.
Seoul wants to raise the self-sufficiency level from around 4 percent at present to 18 percent in 2013.
It said the estimated size of the Blackgold Mine in the Cold Lake region of Alberta will allow South Korea to extract 30,000-35,000 barrels of oil per day for the next 25 years.
Hwang Doo-yul, CEO of state-run Korea National Oil Corp. (KNOC), and Geoff Waterman, vice president of Newmont Mining of Canada, signed the deal in Seoul. The Canadian company is an affiliate of U.S.-based Newmont Mining Corp., the world's largest gold producer.
The South Korean firm is expected to begin production in 2008, with full-scale operations to commence two years later. KNOC paid $270 million for the mining rights and expects annual sales to reach $500 million once full-scale production commences.
Oil sands, also referred to as tar or bituminous sands, are deposits of bitmen trapped in a mixture of clay, sand and water. They are in essence sand or sandstone containing at least 10 percent petroleum.
There are estimated to be 175 billion barrels of petroleum that can be extracted from oil sands mines around the world, with Canada having the world's second-largest reserve of oil sands after Venezuela.
Canada, which has most of its oil sands mines in the Peace River, Cold Lake and Athabasca regions of Alberta, can churn out 4.7 billion barrels of oil on an annual basis.
The ministry said once production begins, the country's oil output self-sufficiency level could be raised by around 1.2 percent.
South Korea currently produces 115,000 barrels of oil daily from local and overseas oil fields.
Seoul wants to raise the self-sufficiency level from around 4 percent at present to 18 percent in 2013.
Post a Comment