South Korea has secured 2027 term contracts for 23.5 million metric tonnes (mt) or 62.3 percent of the 37.7 million mt it expects to need that year, state-run Korea Gas Corp. said.
The country has secured 34 million mt for 2015, above the 33.9 million it needs for the year, according to a Kogas report submitted to the National Assembly.
Kogas, which has a monopoly on domestic natural gas sales, expects South Korea’s 2015 LNG consumption to be 34 million mt, down from an earlier outlook of 39.8 million due to weak power demand on relatively higher prices of LNG and rising nuclear power output.
Kogas said its revised forecast was made on the basis on sluggish January-July domestic sales, which fell 8.8 percent year on year.
Kogas planned to import 33.84 million mt in 2015, down 7.4 percent from 36.33 million mt imported in 2014, given weaker demand.
“Short-term LNG shortage will be made up by short-term contracts to cover winter demand and spot purchasing if necessary, while long-term shortage would be partly filled by volumes from overseas projects in which Kogas is involved,” the report said.
Kogas imported 18.35 million mt of LNG over January-July, including 13.08 million mt or 71.3 percent from the Middle East and South Asia.
It bought 7.32 million mt or 39.9 percent of its January-July imports from Qatar and 2.45 million mt or 13.4 percent from Oman, the report said.
It imported 1.87 million mt from Malaysia, 1.44 million mt from Indonesia, 1.15 million mt from Russia and 790,000 mt from Australia in January-July. The other 3.33 million mt came from 10 minor suppliers, including Nigeria, Equatorial Guinea and Brunei.
Of Kogas’ total January-July imports, 15.11 million mt or 82.3 percent came under long- and mid-term contracts, 2.16 million mt or 11.8 percent was imported under short-term contracts, and 1.08 million mt or 5.9 percent came from spot buying.
“Under its plans for long- and mid-term contracts, Kogas is seeking more volumes from Australia and North America so as to ease the dependence on Middle East and South Asian nations,” the report said.
“In particular, Kogas is pushing to bring in more volumes from projects in which Kogas holds stakes, such as LNG Canada.”
The company currently has 15 contracts covering 24.12 million-31.44 million mt/year in imports for 2015-2019.
The deals include 4.92 million mt/year from Qatari RasGas, 2.1 million mt/year from RasGas II and 1.5 million-2 million mt/year from RasGas III, 4.06 million mt/year from Oman’s OLNG, and 2 million mt/year from Yemen’s YLNG, among others.
