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Russia, South Korea expand business relations
Published: 07 May, 2010, 22:01
Edited: 11 May, 2010, 10:32
TAGS: Investment, Manufacturing, Natural resources, Oil, Regional development, Finance, Gas
A large new energy complex in the far eastern region of Sakhalin will expand economic cooperation between Russia and South Korea.
The Sakhalin oil and gas project could be just the start of a much bigger partnership with road construction, power plants and sea port upgrades also on the agenda, says Sakhalin Region Governor, Aleksandr Khoroshavin.
“Russia has a large project to offer South Korea. We want to build a diversified energy complex in the Sakhalin region. It’s a big project which includes oil and gas development, coal extraction and the construction of a big power plant. We also need to build the infrastructure like motorways and railroads.”
Russia needs to attract almost $5 billion to build such an energy cluster and hopes that much of it can come from South Korea. In Seoul everything shows what an innovative economy really looks like. But there’s something it wouldn’t work without and that is Russian gas.
Russia supplies 45% of oil and 16% of gas to South Korea from the fields at the Sakhalin region. South Korea, in turn, offers innovation. The Sakhalin 1 and 2 oil-and-gas projects relied heavily on South Korean technology. Korea was the main supplier of equipment for an offshore platform and the first LNG plant in Russia – as well as its first customer, explains Sakhalin Energy CEO, Andrey Galaev.
“Many assets of our projects are examples of innovative technology, including our offshore platforms that have been built in Korea. It’s very modern technology and almost $1.5 billion has been invested and this is the scale of work that has been done by our Korean partners.”
But Russia and South Korea want to go beyond the limits of oil and gas. With the need for almost limitless infrastructure – there will be enough business to go around.
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4 comments
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The largest black hole in the Far East is North Korea as it is placed as an obstacle to trade and investment between South Korea and Russia. But, the same way as Taiwan and China participate in the last APEC Summit, Russia has to make possible for North Korea to participate in the Vladivostok 2012 APEC Summit. The largest handicap to Far East development is North Korea, but it can become also an important opportunity for Russian manufactured products as it is far behind in development. North Korea´s 24 million people will need the kind of technology that Russia can offer more than that of Japan or S.Korea which is too high and expensive for North Koreans. Russia, as a consequence of its own evolution since 1991, knows better (or should) how can North Korea evolve given the necessary conditions. Russia has to make sure that North Korea participates in Vladivostok 2012
Its always nice to see when states cooperate for mutual benefits...In last years I notice that more and more Russia and S.Korea doing bussines in various fields.There is a lot more of things for broader cooperation ( I think) among this two countries.Good news-work hard and all the best! Thanke you.