A Korean energy developer said Wednesday that it has obtained approval from Jordan to negotiate a deal for the development of a massive oil field in the western part of the Middle Eastern country.

The Jordanian Cabinet approved a memorandum of understanding on negotiations for a final agreement Tuesday to explore the field with an estimated reserve of more than 1.1 billion barrels, said Park Cheong-sig, president and CEO of Korea Global Energy Corp. A signing ceremony will soon be held.

Under the MOU, both sides will have up to four months to conclude their negotiations for a production sharing agreement, which will entitle the South Korean company to 32.7 percent of total output from the oil field.

“Negotiations for the PSA will likely be concluded at an early date as most details for the agreement have already been discussed during our negotiations for the MOU,” Park told Yonhap News Agency.

Under the proposed PSA, KGEC will have to drill three exploration holes within the next four years, but Park said the oil field could begin commercial production as early as 2014. 

The agreement, if signed under currently proposed terms, will give the South Korean company 32.7 percent of total production at the field, which could translate into 376 million barrels out of the 1.15 billion barrels in probable reserves, he said.

The proposed project covers about 6,819 square kilometers of land at the Dead Sea and Wadi Araba Block, which according to Park, has a “probable” or more commonly referred to as P2 oil reserve of 1.15 billion barrels, earlier discovered by a U.S. firm.

The U.S. firm, Park said, claims the area could hold up to 7 billion barrels of oil in P3 or estimated reserves, and was planning to begin commercial production next year before its relations with the Jordanian government went sour.

KGEC, upon signing the proposed PSA with Jordan’s National Resources Authority, will replace the American firm as the sole developer of the field in the southern basin of the Dead Sea.

The reserve, if confirmed, will mark the largest find in the Middle Eastern country where the existence of any large commercial oil deposit is often subject to heated debates.

An official from South Korea’s presidential office Cheong Wa Dae said such a find was still possible.

“It is true that Jordan is located near large oil producing countries, such as Saudi Arabia, Iraq and Iran,” the official said earlier, while speaking on condition of anonymity.

“Israel, which is also nearby, recently announced its discovery of a large gas mine, so there is no guarantee that there is no oil in these countries,” he added. (Yonhap News)