S Korea, Novatek to Co-operate on LNG

The presidents of Russia and South Korea – Vladimir Putin and Moon Jae-in – and the heads of Novatek and Kogas – Leonid Mikhelson and Seung-Il Cheong – signed a memorandum of understanding (MoU) on collaborating and developing future LNG opportunities, Novatek said June 22. 

They will explore opportunities for Kogas to enter the Arctic LNG 2 project and possibly buying some of the output, as well as to participate in the LNG transshipment project in Kamchatka and other infrastructure projects, as well as develop co-operation in LNG trading and logistics optimisation, including swap operations.

Mikhelson said: "The Asian Pacific markets are a priority destination for our LNG projects as this important geographical region represents the fastest growing markets for natural gas consumption, and South Korea is presently one of the largest importers of LNG. Our scalable LNG projects combined with our huge hydrocarbon resource base, our low cost LNG production and the further development of our logistics model using the Northern Sea Route and the transshipment terminal in Kamchatka create perfect opportunities for mutually beneficial co-operation for our potential partners. The competitiveness and attractiveness of our future LNG projects is once again confirmed with the signing of this MOU with KOGAS – one of the largest players on the Asian LNG market.”

The transshipment terminal is to be for reloading from Arc 7 vessels on to conventional tankers, and its capacity is expected to be under 1mn m³, or no more than about six Arc 7's-worth of LNG.