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South Korean Company Signs MOU For Jordan’s Dead Sea Block

Jordan’s Natural Resources Authority (NRA) and Korea Global Petroleum Corporation on 21 February signed a memorandum of understanding (MOU) for exploration in a block located in the Eastern Dead Sea/Wadi Araba region, which was relinquished by previous operator Porosity Ltd after failing to reveal any hydrocarbons (MEES, 27 April 2009). The Dead Sea block, with an area of 6,819 sq km, was originally awarded in 1997 to Trans Global Resources of the US in a production sharing agreement (PSA) with the NRA. But in December 2006 Porosity bought 80% of the PSA in a farm-out agreement, with the remaining 20% kept by Trans Global. In 2007 the latter was accused of breaching its agreement with Jordan and a dispute arose among the parties leading to an international arbitration court case.

Under the MOU, NRA and the Korean company will have three months (plus a one-month extension) to finalize a new PSA that will include the drilling of three exploration wells over a four-year period to determine the prospects for the block. Korea Global is a private company backed by the South Korean government to prospect for overseas natural resources. According to press reports from 'Amman, the block is engulfed in some controversy dating back to 2005, when Trans Global informed the Jordanian government of technical details showing the existence of oil reserves in the Dead Sea, which the NRA did not deem as commercially feasible. Porosity in turn also failed to confirm the presence of commercially viable deposits.

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