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Show Japan Petroleum Weekly October 5, 1970 DR. Wendell Phillips's Entry Into Korea Dr. Wendell Phillips on September 24-, 1970, received from the South Korean Government an offshore oil concession of 15 million acres, known as "Zone Seven". The area is located to the south-southeast of Korea. Dr. Phillips signed the deal as president of the Wendell Phillips Cil Company (Korea) Ltd. , a whollv owned subsidiary of the Wendell Phillips Oil Co. "Zone Seven" is one of the largest offshore concessions in the world and preliminary investigations indicate an oil potential similar to that of the Middle East. Details of the agreement are as follows: (1) Royalty payable by Phillips is 12.5 per cent in cash or kind. (2) Taxation will be levied at the rate of 50 per cent of the net profit. (3) Phillips is committed to spend 7.5 million dollars in the first seven years of the concession and has an option of a further two years for an additional three million dollars, making a total of 10.5 million dollars for the first nine years. Phillips will make bonus of one million dollars within 30 days of the first commercial delivery. After production reaches 100,000 barrels a day, there will be a five million dollar production bonus. Dr. Phillips is also paying out a 500,000- dollar signature bonus. In addition, he has decided to set up an educational fund in Korea worth 50,000 dollars a year. Dr. Phillips said that Korean citizens may purchase up to a 20 per cent working interest in Wendell Phillips Korea, Ltd. , with the approval of the Korean Government provided Phillips' expenditures on the project have not exceeded five million dollars, but they may not come in after that figure has been exceeded. Dr. Phillips said: "1 am delighted that I shall be working with the Korean Government to help develop the commercial potential of this vital country. 1 am personally grateful to President Chung Hee Park and Prime Minister Chung for their wonderful cooperation." Dr. Phillips, an avid traveller in the Far East, is well known in Korea and a constant visitor there. In 1966, he received an honorary degree in divinity from Kyung-Pook National University. Other international oil companies currently operating in Korea are Gulf, Shell and Caltex. Besides offshore Korea, Dr. Phillips holds concessions in Saudi Arabia, North Africa, South America, as well as in the Southeast Asia and the Far East. Dr. Phillips signed on September 23 a new production sharing contract with Pertamina of Indonesia for the recently acquired area of more than 2.5 million acres on the coast of West Irian Indonesia, next to his previously acquired area of 7.5 million acres to the north of the new area, total area now exceeding 10 million acres. In an exclusive interview with the Japan Petroleum Weekly during his recent visit to Tokyo, Dr. Phillips, as an owner of the mining right (and not as a broker), emphasized that he would be delighted to enter into talks with any Japanese partners, who are interested in a joint exploration/devlopment venture in Indonesia on a 50:50 participation basis. - 5 - |