South Korea's Board of Audit and Inspection found that the presidential office under former President Yoon Suk-yeol pressed the Ministry of Trade, Industry and Energy to move up additional drilling for the "Blue Whale" deep-sea gas field project in the East Sea, originally scheduled through 2029, to within Yoon's term. The ministry judged the compressed timeline unworkable but ultimately drew up a plan to drill four additional wells by 2026 on Yoon's instructions, according to the audit board.
According to the audit findings on a public-interest audit request concerning the East Sea deep-sea gas field project, released by the board on the 16th, the ministry reported to the presidential office in May 2024 a plan to drill four additional wells through 2029 after the first Blue Whale well was drilled by the end of 2024. In September of that year, however, after receiving a briefing on the specific drilling schedule, the presidential office demanded the timeline be moved up to within Yoon's term, which ran to May 2027.
When the ministry explained that shortening the schedule would be difficult because evaluation and analysis of each well required time, the presidential office arranged for then-Trade Minister Ahn Duk-geun to report directly to Yoon. Ahn presented a plan that advanced completion of drilling to the first quarter of 2028, explaining that "a political judgment is needed." Yoon rebuked him, saying, "I am the one who makes political judgments," and ordered the schedule redrawn. Ahn then reported back a plan to drill four additional wells by 2026, even though he considered the timeline unrealistic, the audit board found.
The Blue Whale drilling itself was also pursued without adequate verification, the audit found. The contractor that conducted the prospectivity assessment estimated total exploration resources for seven promising structures, including Blue Whale, at 7.42 billion barrels on a P50 basis, the median of estimated resource volumes. That was 165 times the 45 million barrels produced from East Sea gas fields over the previous 17 years, and for some structures the estimate was 39.2 times higher than assessments by other firms in the past.
Even so, Korea National Oil Corporation confirmed only the appropriateness of the analytical method through an overseas advisory panel, then drew up a basic plan for Blue Whale drilling in October 2023, before the contract work was even completed. The audit board judged that drilling proceeded without sufficient verification of exploration resource volumes and the geological probability of success. In drilling carried out from December 2024 to February the following year, gas saturation came to just 6.3%, far below the 50% to 70% initially expected. The gas that was found was biodegraded biogas rather than the thermogenic hydrocarbons that would indicate a strong likelihood of oil and natural gas.
Violations of the State Contracts Act were also confirmed in the process of selecting the prospectivity assessment contractor. Although 17 firms had experience performing such work — too many to meet the requirements for a limited competitive bidding process — the state oil company arbitrarily selected only four firms for the first contract and three for the second, without conducting a separate market survey. It also emerged that the company did not disclose bid evaluation criteria to the firms and, in the second contract, applied evaluation items that had not been set in advance to eliminate a competing bidder. The audit board called for disciplinary action against those involved.
The audit also found that the oil company placed an order for drilling rig charter services before the matter had been deliberated and approved by its investment risk committee and board of directors. The board noted that the mandatory drilling deadline at the time was April 2026, so there was no need to rush drilling to the end of 2024, and said adjusting the work to June or July 2025 could have saved 4.3 billion won (about $3.1 million) in charter fees. The audit board did not, however, require separate action from the presidential office or the ministry over Yoon's public announcement and the reporting process on the project, citing the absence of relevant regulations.
