Gazprom is considering building a gas pipeline to South Korea, CEO of the Russian gas monopoly Alexei Miller told reporters on Wednesday. He added that the sides are considering a land version of the construction of this pipeline
“During the pre-investment feasibility study we analysed the options of gas supplies to the Republic of Korea, in particular, the variant of pipeline natural gas, compressed natural gas and liquefied natural gas,” Miller continued. “All options have been analysed, presented by the companies to each other, and in the course of further negotiations the version of the delivery will be finally determined. The variant of gas supplies to the Republic of Korea through a pipeline is also possible,” he said.
Miller also noted that the option of building a pipeline under the sea is not considered. Answering a question whether the issue of gas supplies via North Korea is being considered, the Gazprom head said: “a land version of the gas supply is under consideration.”
“Decisions on the gas pipeline will be taken at the time, which will allow for the start of physical supplies of Russian gas to South Korea in 2017,” he said. “The decision will be made in due time,” Miller added.
Gas reserves of the Republic of Korea are extremely limited, and today the country actually doesn’t produce gas from its fields. At the same time, gas consumption in Korea amounted to 21.9 bcm in 2002. According to the forecasts, gas consumption in the country is expected to grow 1.5-fold by 2010 and to double by 2020. At present, the gas market of Korea entirely depends on LNG import. A well-developed gas transmission network linking the coastline LNG terminals with the main gas consumption centres has been created in the country. That’s why not only power producers, but also manufacturing companies and the citizens are among major gas consumers. Set up in 1983, the Kogas company is the sole operator of the Korean gas transmission network. The State holds 62 percent of the company’ s assets. Construction and operation of LNG terminals and gas distribution grids, implementation of gas projects abroad and R&D in the gas sector are the core activities of the company. The company possesses 3 LNG terminals and gas pipelines with the total length of 2,442 km.
Gazprom is implementing a staged strategy of expanding its presence on the liquefied natural gas (LNG) market. This helps to extend the company’s business geography. In 2005 Gazprom supplied its first LNG cargo to the USA, in 2006 – to the Great Britain, Japan and South Korea. Gazprom’s entry in the Sakhalin II project gives a strong impetus for the completion of a large-scale project targeted at supplying energy carriers to Asia-Pacific and North America. In 2009 the first Russian LNG plant was launched in Sakhalin.