South Korean state-owned company Korea National Oil Corp (KNOC) has decided to pull out of the Sangaw South oil field project in the Kurdish region of Iraq, after investing a total of $204m since 2008, Reuters reported.

KNOC spokesman, Cho Jung-geun, said: “The pullout was decided in a recent board meeting as we figured economics of exploration and production were low to carry out the project.”

A Korean consortium headed by KNOC holds 60% of Sangaw South, with half of that owned by KNOC. The company signed a production-sharing agreement for the Sangaw South oil field with the Kurdish Regional Government in December 2008, wrote The Korea Herald.

South Korea’s state-run energy firms have come under pressure over loss-making overseas assets in recent years, prompting them to sell some of their foreign projects as part of a broad debt-cutting and restructuring plan.