SEOUL: State-owned Korea National Oil Corp (KNOC) has decided to drop out of Iraq's Sangaw South oil field project because of uneconomic exploration results, a KNOC spokesman said on Monday.
A Korean consortium headed by KNOC holds 60 percent of Sangaw South in the Kurdish region of Iraq, with half of that owned by KNOC.
The state-run oil company has invested a total of about $204 million on exploration and acquisition of the stake since 2008.
"The pullout was decided in a recent board meeting as we figured economics of exploration and production were low to carry out the project," KNOC spokesman Cho Jung-geun said.
KNOC signed a production-sharing agreement for the Sangaw South oil field with the Kurdish Regional Government in December 2008, according to the KNOC website. South Korea, Asia's fourth-largest economy, is the world's fifth-largest crude importer.
Since 2008, it has engaged in overseas exploration and production projects to try to secure its fuel needs.
The country's state-run energy firms, however, have come under pressure over loss-making overseas assets in recent years, prompting them to sell some of their foreign projects as part of a broad debt-cutting and restructuring plan.
Earlier this month, KNOC said it was in talks to pull out of an oil project in Kazakhstan after discovering less oil than expected. The Korean consortium had invested around $250 million in the project since 2008.
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