The DPRK has been fully set on oil business since 1993 when the government upgraded the Petroleum Research Bureau to the Ministry of Petroleum Industry.

The oil project was officially endorsed at the 9th Session of the 7th Supreme People's Assembly in 1994 which decided to dramatically increase investments in the oil industry and modernize research equipment.

At present, two main oil projects are underway. One is test borings by the DPRK in some spots of the seashore of Nampo and some spots of the Anju area in South Pyongan Province, and the other is preliminary researches and exploration in the East and West Seas of Korea by foreign companies.

The DPRK has so far set up seven test drilling scaffolds in the seabed of Nampo, and, among them, Scaffold No. 406 had a gush of 450 barrels of petroleum last June. Some oil resources were also located in Anju.

An elastic wave survey was conducted last summer in the West Sea by Taurus Petroleum of Sweden and in the East Sea by Beach Petroleum of Australia respectively.

Meanwhile, business negotiations have been underway between the oil industry ministry and foreign firms in Italy, Japan and Canada.

The DPRK's oil exploration history dates back to 1965 when it officially started its extensive geophysical exploration with the inauguration of the Research and Control Bureau of Fuel Resources. The measure was followed by an establishment of a study institute for oil research in the suburbs of Pyongyang in 1968. The oil project was galvanized particularly after an oil field was discovered in the seabed of Nampo in 1985. Since then, preliminary research and test boring works have been conducted mainly in the West Sea, and its exploration scale expanded to the East Sea in the 1990s.

After 30 years of geological study and test drilling, the Ministry of Petroleum Industry concluded in its recent survey that there are eight oil-bearing basins in the DPRK. They are the Pyongyang Basin, West Sea Bay Basin, East Sea Bay Basin, Onchon Basin (Nampo), Kyongson Bay Basin (Chonjin), Anju Basin (South Pyongan Province) and Kilju Basin (North Hamgyong Province).

The report suggests that the West Sea Bay and Anju Basins are promissing among them, and figures out that the West Sea Bay Basin contains about 5 to 40 billion barrels of oil.

“We are determined to finish the exploration work (to move on to excavation activities) by Sep. 9, the 50th birthday of the DPRK state,” stressed Petroleum Industry Minister Kim Hui Yong.

“General Secretary Kim Jong Il on Sept. 23, 1997 stressed the need to lose no time in developing the domestic oil industry. Bearing his suggestion in our mind, we will concentrate our efforts on Anju Basin and the Korean West Sea continental shelf,” he said.

What north Koreans plan now is to drill wells around oil-hit spots in Anju and Nampo in an attempt to ascertain and measure the actual volume of oil resources. However, its tight economy caused by the three consecutive years of natural disasters and shortage of hard currency have delayed the program. One test drilling costs one to nine million dollars on the ground and two to 10 million dollars in the sea.

North Korean oil experts plan to hold explanatory forums abroad this year to seek foreign partners in the project.