SEOUL, Sept. 24 (Korea Bizwire) — South Korea’s state-run Korea Gas Corp. signed a deal to import an additional US$9.6 billion worth of liquefied natural gas (LNG) from the United States for up to 18 years, in line with efforts to expand ties with the world’s top economy in the energy segment, Seoul’s trade ministry said Tuesday.
Under the long-term agreement with British Petroleum that will run from 2025 to 2039, KOGAS will import U.S. LNG, with an annual volume estimated at 1.58 million tons, according to the Ministry of Trade, Industry, and Energy.
The deal comes with an option for a three-year extension. The volume translates into roughly 5 percent of South Korea’s LNG demand, the ministry added.
The U.S., which accounts for around 10 percent of South Korea’s LNG imports, is anticipated to expand its presence to a whopping 22 percent starting 2025, the ministry said.
The combined value of energy imported by Asia’s No.-4 economy from the U.S. reached $9.4 billion last year, soaring from $1.3 billion in 2016.
The announcement came in line with President Moon Jae-in’s visit to the U.S., where he discussed various ways to bolster the Seoul-Washington alliance with U.S. President Donald Trump.
The deal is expected to help South Korea diversify its energy portfolio and obtain a stable source of LNG, an official from the state-run Korea Gas Corp. said.
KOGAS, the world’s third-largest LNG importer, currently buys mainly from Qatar and Australia.