GS Caltex's Full-Fledged
Participation in Overseas
Oil Exploration

In collaboration with GS Holdings to bring about synergetic effects for petroleum explorationand production ("E&P)

GS Caltex has been actively engaged in overseas petroleum exploration since 2003 when the company first entered into E&P business by acquiring a 15 percent participating interest of Cambodia Block A, located on the west coast of Cambodia
It is noteworthy that the Cambodia Block A project is GS Caltex's first overseas petroleum exploration, and the first phase exploration that lasted until March 2005 accomplished a feat: the discovery of high-quality crude and natural gas in four of the five exploration wells. The Phase II exploration of the Cambodia block A project ended in March 2007 and the evaluation of the drilling results is now under way. Economic effects, including possibility of developing the block and the size of reserves are expected to be unveiled during the year 2007.
GS Caltex is also participating in petroleum exploration in onshore Thailand by acquiring stakes in Blocks L10/43 and L11/43 in July 2006. The newly acquired blocks are located near Thailand's largest onshore oil production field of Sirikit,
which is said to have been already verified for its large oil reserve. GS Caltex took over a 30 percent stake in L10/43 and L11/43 blocks, wholly owned by Siam MOECO Ltd. ("SML", fully owned subsidiary of MOECO of Japan. While undertaking the fist phase exploration of the blocks in December 2006, the fist exploration well was found to have two layers of oil bearing zone capable of producing about 1,254 barrels of crude oil and 720,000 cubic feet of natural gas per day. The Thai blocks, covering 7,651 sq. km, four times as wide as Jeju Island of Korea, are presumed to have geological layers with probable crude oil reserves, and further exploration wells are expected to discover additional extensive crude oil and natural gas reserves. Starting with the drill of a test well, GS Caltex and SML expect to enter into production stage by 2010.
Besides, GS Caltex's holding company, GS Holdings is participating in five exploration projects in Indonesia and Yemen and Kazakhstan. In March 2005, GS Holdings acquired a 5 percent, a 30 percent and a 20 percent interest in NEM1, NEM2 and Wokam blocks, respectively and the company is exploring the blocks together with its partners including Korea National Oil Corp. GS Holdings is intent to further expand its presence in petroleum exploration to such areas as Middle East and Central Asia.
GS Caltex Chairman Hur Dong-soo earlier said his company will aggressively participate in oil exploration projects in Southeast Asia, the Middle East and Central Asia in the years to come with the goal of raising its own petroleum development share to 10 to 15 percent of its refinery capacity of 750,000 barrels per year. To this end, the company is striving to forge business tie-ups with foreign energy companies. GS Caltex is trying to strengthen collaboration with its holding company to maximize synergetic effects for petroleum exploration, while striving to secure core manpower necessary for the implementation of overseas E&P projects.
GS Caltex is now studying ways of making an additional foray into such strategic areas as Russia, Southeast Asia, Middle East and Central Asia, which have become the subject of global limelight as part of its efforts to join forces in helping Korea achieve a goal of raising its own petroleum production rate to 18 percent by 2013 out of Korea's total oil and gas demand. nw

GS Caltex Chairman Hur Dong-soo

The Cambodia Block A project is GS Caltex's first overseas petroleum exploration.s