▲ SK Earthon CEO Myeong Seong

On October 1st, 2021, SK Innovation’s E&P (Exploration and Production) Business has officially become an independent company with new corporate name: SK Earthon. “Earthon” is a coined word combining “earth” for “the globe” or “terrain”, and “on” for “continuation”. SK Earthon connotes the message of “Realizing the value of resources based on technical prowess and expertise, and turning on the hope of green business that promises a sustainable future.”

Newly appointed CEO of SK Earthon Myeong Seong joined SK Innovation (formerly Korea Oil Corporation) in 1995, and is an E&P expert who served various positions including Head of Bogota Branch, Leader of Exploration Business in E&P Business. Since becoming the President of E&P business in early 2021, he has been leading the company to sharpen its competitive edges and exploring green business.

Let’s meet CEO Myeong Seong through our interview to learn more about SK Earthon’s strategies for a sustainable growth in the future.

Q1. As the CEO of SK Earthon, which has just grown to be an independent company from the oil exploration and Production (E&P) business, what are your determinations?

One of the long-cherished dreams of the E&P business, which took its first steps in 1982, was the independence and growth of E&P as a specialized company. At last, all the members of SK Earthon are standing together on the starting line.

Of course, SK Earthon’s future journey is far more challenging than the E&P businesses in the past, and more changes and innovations are coming. Still, we have the will and confidence to create a new and stronger future based on our accumulated competence and experience.

When I imagine the transformation and status of SK Earthon 3 years, and then 10 years from now, I honestly feel very excited. I will do my best in every moment to cheer up and take the lead so that my excitement now can be fulfilled in the not-too-distant future.

Q2. Could you elaborate on the strategies of SK Earthon to realize “Carbon to Green” transformation and build a green portfolio?

▲ SK Earthon CEO Myeong Seong explains the company’s Green Transformation strategy to its members

It is the fact that E&P is at the top of the so-called “carbon business”, so we might say that the carbon challenge is really big to us.

However, until the energy and infrastructure that can replace oil & gas are ready, oil & gas are still absolutely necessary for humanity. On the other hand, E&P is the only business that utilizes CO₂ generated during the oil & gas production process and also applies the technology to permanently isolate CO₂ through underground storage.

This is where SK Earthon’s “Carbon to Green” strategy began, and we divided it into two major categories for the mid-to-long-term vision as a carbon-neutral company.

First is the successful establishment and growth of upstream domains centered in Southeast Asia.
Based on the success of the China and Vietnam projects, we will expand and complete the upstream cluster in Southeast Asia and further enhance the technological/operational capabilities of all stages of exploration/development/production to strengthen our sustainability as an E&P specialist. In addition, we want to step forward as a CO₂ Free Operator by building and operating eco-friendly facilities that minimize CO₂ emissions from the oil & gas production stage.

Next, we will establish and expand the Green Domain based on the CCS (Carbon Capture and Storage) business.

Based on SK Earthon’s upstream technological/operational capabilities, we plan to verify the business model based on CO₂ storage and accelerate CCS-centered green transformation by turning it into a business early on.

Currently, we are in the process of excavating CO₂ storage in the West Sea and East Sea by participating in national projects and the like. We will continue excavating CO₂ storages in Southeast Asia, where SK Earthon is participating in building a practical platform for implementing SK Innovation’s Net Zero strategy.

Q3. Recently, SK Earthon signed an MOU with the Korea National Oil Corporation to carry out multi-departmental national projects promoted by the government in relation to the CCS project, a key business for solving the carbon problem. What kind of tasks will SK Earthon carry out?

▲ East Sea Gas Field of the Korea National Oil Corporation

Since May of this year, SK Earthon has been the only private oil development company to participate in the CO₂ underground storage excavation field in the West Sea, one of the Korean government-led national projects.

The main purpose of the comprehensive MOU between SK Innovation and the Korea National Oil Corporation is to utilize the West Sea gas field operated by the Korea National Oil Corporation and successfully carry out the CCS demonstration project to store some of the CO₂ generated in Ulsan CLX and secure additional CO₂ storage sites in the East Sea. In this regard, SK Earthon will conduct joint research with the Korea National Oil Corporation to discover additional CO₂ storage in the East Sea area.

We plan to select promising areas for CO₂ storage through geological evaluation and evaluate storage capacity and stability through underground structure modeling, characterization, and simulation. After that, we will proceed with physical exploration and drilling for major storage candidates to check the feasibility of storage. Ultimately, we aim to secure a large-scale storage that can store the CO₂ emitted from Ulsan, including our CLX.

Q4. We are aware that SK Earthon is currently expanding the scope of DT (Digital Transformation) technology application across the entire E&P business process, including exploration, development, and operation. Can you tell us about the current status of DT application in the E&P business and its future direction?

It would be no exaggeration to say that SK Earthon’s expertise stems from its E&P technological capabilities. The core of E&P business technology starts from removing the countless risks and uncertainties in order to find oil & gas that are buried thousands of meters underground. In other words, the task is to figure out where oil & gas production took place hundreds of thousands of years ago, which rock layers they moved through, and which rock structures they were stored in.

The problem is that in order to explore the entire process, a massive amount of data is analyzed in specialized areas such as geology, geophysics, and petroleum engineering, which takes a considerable amount of time to analyze and draw conclusions.

Because of this, the E&P business requires DT based on big data and machine learning.

SK Earthon established a technical road-map that defined the core technologies of the business and we have been carrying out about 10 data science projects since 2018. To achieve this, we are in extensive collaboration with not only the SK Innovation Optimization Office and the DT Lab, but also with SK C&C and leading universities in Korea.

In the process, we have made many meaningful achievements, and as a result, we have registered 3 patents in the United States, China, and Korea for the technology we secured. We are currently preparing 1 more patent application.

In the future, we plan to focus more on the following three areas in connection with SK Earthon’s ongoing businesses, and we plan to expand DT to the CCS field as part of our mid-to-long-term goals.

First, we will improve our exploration success rate by developing/integrating various geophysical predictions and geological analysis models.

Second, we will promote offshore engineering optimization and SHE (Safety, Health, Environment) advancement by selecting/developing core DT technologies required for offshore production operations in line with the production timing of offshore mines in China.

Third, we will advance our business management and operation by combining various analysis models with the automation/systematization of commercial tasks.

Q5. Lastly, is there anything you would like to say to the members?

▲ SK Innovation CEO Kim Jun (3^rd from left), SK Eeathon CEO Myeong Seong (4^th from left), and SK Innovation’s Chairman of the Board Kim Jong-hoon (3^rd from right) pose for a commemorative photo at the launching ceremony of SK On and SK Earthon as independent companies held at SK Seorin Building (Seoul, Korea) on October 1^st, 2021.

Taking the first step on a road you’ve never traveled before can make you feel anxious, and you may occasionally meet a dead end. However, I believe that the path SK Earthon wants to take is a journey where we can overcome anything as long as we have the spirit to “explore,” the fundamental spirit of the E&P business that we have preserved for the past 40 years.

I believe that all the members of SK Earthon, including myself, are explorers on a search for the same goal. In other words, the business we will create together and the company’s performance and values ​​are our goals, which will ultimately lead to the individual performance and values ​​of each member.

It’s a challenge because it’s not easy, and there is no change without discomfort, but I hope the very fact that we are now together at the starting point of increasing the values of both SK Earthon and its members will be of great source of positive strength to everyone.