Archive for the ‘Russian Pipeline’ Category

Foundations of Energy Security for the DPRK: 1990-2009

Tuesday, December 18th, 2012

The Nautilus Institute has put together an amazing research paper on the DPRK’s energy sector. I cannot understate the value of the quality/quantity of facts/figures/tables in this research.

You can download the PDF here.

I have also added it to my DPRK Economic statistics Page.

Here is the introduction:

Energy demand and supply in general—and, arguably, demand for and supply of electricity in particular—have played a key role in many high-profile issues involving North Korea, and have played and will play a central role in the resolution of the ongoing confrontation between North Korea and much of the international community over the North’s nuclear weapons program. Energy sector issues will continue to be a key to the resolution of the crisis, as underscored by the formation of a Working Group under the Six-Party Talks that was (and nominally, still is) devoted to the issue of energy and economic assistance to the DPRK.

The purpose of this report is to provide policy-makers and other interested parties with an overview of the demand for and supply of the various forms of energy used in the DPRK in six years during the last two decades:

  • 1990, the year before much of the DPRK’s economic and technical support from the Soviet Union was withdrawn;
  • 1996, thought by some to be one of the most meager years of the difficult economic 1990s in the DPRK; and 2000, a year that has been perceived by some observers as a period of modest economic “recovery” in the DPRK, as well as a marker of the period before the start, in late 2002, of a period of renewed political conflict between the DPRK, the United States, and it neighbors in Northeast Asia over the DPRK’s nuclear weapons development program; and
  • 2005, also a year in which observers have again noted an upward trend in some aspects of the DPRK economy, as well as the most recent year for which any published estimates on the DPRK’s energy sector and economy are available.
  • 2008, the last year in which the DPRK received heavy fuel oil from its negotiating partners in the Six-Party talks; and
  • 2009, the most recent year for which we have analyzed the DPRK’s energy sector.

Russia-Korea gas pipeline compendium

Thursday, October 4th, 2012

UPDATE 43 (2015-6-17): Gazprom official claims pipeline not feasible. According to NK News:

The deputy CEO of Russia’s Gazprom told reporters that connecting South Korea to Russian gas supplies is economically attractive but politically infeasible on Tuesday.

The long-gestating pipeline project would extend through the DPRK and provide natural gas to energy-hungry South Korea.

But Alexander Medvedev, speaking from a press conference in Moscow yesterday, said the project was too difficult in the current climate.

“The level of communications, the level of cooperation is not that which would make it possible to speak of advancing to the feasibility study stage, let alone implementing a project to supply gas via North Korea.”

Despite the political hurdles, the project is still interesting from an economic standpoint.

“From the economic standpoint, this would probably be the most efficient option for supplying gas to Korea … There is demand for pipeline gas,” Medvedev added.

Despite the numerous roadblocks, the deputy CEO of the world’s largest gas producer remained hopeful that political changes could move the project forward.

“The opportunity remains all the same, but it depends on a resolution of the political issues between the DPRK and the Republic of Korea. There are certain positive signals, but there are negative signals too,” Medvedev said at the press conference.

Post 42 (2014-6-18): According to Leonid Petrov, “Russian GAZPROM postpones Trans-Korean gas pipeline construction project ‘due to unstable political situation in South Korea'”. Here is the source (in Russian).

Post 41 (2014-3-29): According to Yonhap, the Russians and the North Koreans held talks on a number of issues including the Kaesong Industrial Complex, Iron Silk Road, and the gas pipeline.  No information on the pipeline was made public.

Post 40 (2013-11-13): The Russians and South Koreans most recently discussed the Russia – South Korea gas pipeline at a presidential meeting in Seoul. No decisions were made. Read more here.

Post 39 (2012-10-4): The Choson Ilbo reports that the pipeline talks are delayed because DPRK is asking for transit rates above the international norm:

A South Korean government source said talks have dragged on because the North is demanding a transit fee that is two to three times more than international rates.

Based on a method of calculation used by Ukraine — about $2 per 1,000 cubic meters of natural gas for 1 km of pipeline — a reasonable fee would be about US$150 million a year given the estimated amount of gas South Korea would import from Russia and the 700-800 km of the gas pipeline running through the North. But the North reportedly demanded $300-500 million a year.

“It’s likely that the North asked for such a high price in the first place to gain the upper hand in future talks,” the source added. “There have been no full-fledged talks yet. At the moment, Pyongyang, Seoul and Moscow are just trying to read each other’s minds.”

Post 38 (2012-2-27): The Daily NK reports on details being discussed in the pipeline talks:

The Republic of Korea Ambassador to Russia, former chief nuclear negotiator Wi Sung Lac, says there has been progress on a gas pipeline connecting Russia, North Korea and South Korea.

“At the moment it is at the stage of enterprises discussing commercial conditions, and I am aware that there has been progress. North Korea and Russia are also discussing issues of transit and transit fees via working-level consultations,” he explained to reporters on a visit to Seoul today.

Wi would not be drawn on what kind of progress has been achieved, saying, “It’s about commercial details and so is hard to explain, but it appears there has been progress on supply quantities and supply conditions.”

Post 37 (2012-2-20): Gazprom reports “progress” in talks with North Korean government. According to Bloomberg:

OAO Gazprom, Russia’s natural gas exporter, said it made progress in talks to supply Korea Gas Corp. (036460) through a pipeline across North Korea, the Moscow-based company said today in an e-mailed statement.

Gazprom and Kogas, as the Korean company is called, plan to meet again in Moscow next month to continue talks, Gazprom said.