A project to import Russian gas to South Korea
via North Korea could be a valuable economic and political tool that fosters
more economic cooperation between the two Koreas.
On
Thursday, South Korean President Moon Jae-in, who took office in May,
addressed the Korber Foundation in Berlin. He talked about the path
towards a peaceful Korean peninsula and stressed that greater economic
cooperation with North Korea is an important foundation to the
establishment of peace there.
Jae-in,
who is affiliated to the South Korean Democratic Party, said that he has
planned a “new economic map for the Korean Peninsula,” which will be put
into action if there is progress on the North Korean nuclear issue.
The
plan includes a fresh connection between the South and the North
across the military demarcation line, an “economic belt” which would
“establish an economic community where the two Koreas prosper together,”
the Korea Herald reported Jae-in as saying.
“The severed inter-Korean railway will be
connected again. A train departing from Busan and Mokpo will run
through Pyongyang and Beijing, and head towards Russia and Europe.
Cooperation projects in Northeast Asia, such as the gas pipeline
project connecting the two Koreas and Russia, may also be implemented.”
“South
and North Korea will prosper together as a bridging country connecting the
Asian mainland and the Pacific. The South and the North need only
to implement the Oct. 4 Declaration together. Then the world will see a
new economic model of an economy of peace and co-prosperity,” the
South Korean President said.
Back
in 2008, Moscow and Seoul reached a preliminary agreement on the
delivery of Russian gas and negotiations with North Korea
about transit began in 2011, when Russia’s Gazprom and South Korea’s Kogas signed a roadmap
for the project’s construction.
The
proposed pipeline is planned to be at least 1,100km in length,
at least 700km of which would pass through North Korean
territory. According to Gazprom, it would have a capacity
of at least 10 billion cubic meters per year.
The
project appears to be a win-win for all concerned: Russia would gain
a new export market, North Korea would benefit financially as a transit
country and South Korea would receive a stable and more economical supply
of gas.
Konstantin
Simonov, Director General of Russia’s National Energy Security Fund says
that the pipeline represents a better deal for South Korea than the
liquefied natural gas (LNG) it currently imports from overseas.
“Korea buys liquefied natural gas. All Asian
countries are interested in gas pipelines because it is always cheaper.
That is why Japan also periodically returns to the idea of a gas pipeline,” Simonov told the Russian newspaper Vzglyad.
Simonov
said that the prospects for the project are dependent on inter-Korean
relations.
“When (the late, former South Korean
President) Roh Moo-hyun was in office, he promoted the ‘Sunshine Policy,’
that is, involving North Korea in joint projects and thereby changing the
country in a peaceful way. During his term in office, projects
to build the gas pipeline and to build a railway through North
Korea which would carry cargo across the Trans-Siberian Railway were
approved. The previous South Korean President promoted a completely different
policy: that talking to North Korea is pointless, they are outlaws,
enemies, there is no sunshine and we will increase our defense. But
since a supporter of rapprochement with North Korea has again won the election, the project
to build a gas pipeline from Russia has been revived.”
Despite
that, traditional objections to the project have also been raised, Simonov
said.
“Opponents
have named the traditional arguments against the gas pipeline: that South
Korea will become dependent on this pipeline and that North Korea will
blackmail, manipulate and may even block the transit. However, it should be
noted that South Korea has LNG terminals, so if the gas pipeline is
disconnected, it won’t not be cut off from energy resources. When the
country has another source of gas, there is no sense in turning
off the pipe.”
Simonov
said that one of the sticking points of the project is disagreement
between Gazprom and Kogas over who bears responsibility for the
transit across North Korea and therefore who bears the risk. This time
round, the same issue is likely to arise.
“When Gazprom was holding negotiations about the
gas pipeline last time, the main question was, where will the point
of delivery of Russian gas be? Gazprom said that it was ready
to invest in the construction of the pipeline, but that the
gas would be sent to the border of Russia and North Korea and the
transit risks would be South Korea’s. But South Korea wanted to get the
gas delivered to the border between the two Koreas and
for Gazprom to carry the transit risks. That was the end of the
conversation,” Simonov said.
While
the future of the pipeline project is still unclear, Gazprom and Kogas
have signed several energy agreements to import more Russian LNG from the Sakhalin-2
project, which currently provides 1.5 million tons of LNG per year
to South Korea.
Most
recently, in December the parties signed a deal to increase cooperation including
joint projects in LNG production, transportation and regasification and
in gas-fired power generation.
Reprinted from Sputnik
News.
