SK innovation is actively participating in 29 blocks and 4 LNG projects in 16 countries and has proved reserves of 503 million barrels of oil equivalent at 2009 yearend. Among these, 7 are production blocks in 7 countries, and SK Innovation’s equity share stands at 75,000 barrels of oil equivalent per day as of end of November 2010. In CPO-4 and SSJN-5 blocks in Colombia and Peru Z-46 block, SK innovation is taking the lead in the development and exploration as an E&P operator. Moreover, Peru LNG and #2 train of Yemen LNG started production in 2010. In Peru LNG project, SK innovation has successfully completed the business vertical integration half-way around the world by participating in whole LNG chain from block development to gas production, transportation and exportation.

The roles contributed by the E&P business as a part of the SK innovation are also expanding. In 1999, the E&P business represented 0.6% and 4.7% of overall sales and operating profit respectively. However, the contribution of E&P business increased as the figures of E&P business grew to represent 1.17% of overall sales and 16% of operating profit within SK innovation in 2008. Moreover, E&P business recorded KRW 335.1 billion of sales profit exceeding KRW 300 billion for the first time. The size of the business grew to account for 37% of overall operating profit.

SK innovation will improve company’s technical and operational capabilities through securing and nurturing specialists in E&P business, building operating experiences. At the same time, the company will continue to pursue high-impact exploration projects in its core areas including Vietnam, Peru and Colombia. SK innovation will also strive to achieve company’s strategic growth through efficiently managing the project portfolio, participating in new attractive projects and pursuing mergers and acquisition.