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17.08.2011

South Korea Approves Gas Deals With Shell, Total

South Korea on Wednesday approved deals sought by its state gas company to import 5.64 million tonnes of natural gas annually through Dutch and French firms.

The Ministry of Knowledge Economy said it endorsed Korea Gas Corp's deal with France's Total to buy two million tonnes of liquefied natural gas each year from 2014-2031.

Korea Gas will also forge a deal with Shell to buy 3.64 million tonnes annually for 20 years from 2015 when the Dutch energy giant begins producing gas from its Prelude mine in Australia, the ministry said.

The company is expected to sign formal contracts with Total and Shell in September, the ministry said in a statement without disclosing the value of each deal.

The annual imports of gas through Total and Shell will meet 17 percent of total consumption by South Korea, one of the world's largest natural gas consumers, it said.

South Korea has no proven oil or gas reserves on its territory and relies largely on imported energy to fuel its manufacturing sector. It has tried to diversify its sources away from Southeast Asia and the Middle East.

Copyright 2011, Channel News Asia. All rights reserved.

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