September 29, 2008

South Korea, Russia to Cooperate in Oil, Uranium Development

Text of report in English by South Korean news agency Yonhap

Seoul, Sept. 29 (Yonhap) - South Korea and Russia have agreed to expand cooperation in energy-related research and in the development of oil and uranium, the government said Monday.

Knowledge Economy Minister Lee Youn-ho [Yi Yun-ho] held talks with Russian Energy Minister Sergei Shmatko and concurred on the need for advancing bilateral cooperative arrangements, according to the ministry.

Minister Lee is accompanying President Lee Myung-bak [Yi Myo'ng- pak] in Russia, and called on Moscow to allow more South Korean companies to take part in resource development projects.

Shmatko said in response that Russia views South Korea as an important economic partner in the energy field.

Russia is the world's second-largest producer of oil, and has the largest output of natural gas. It ranks fourth in uranium production and is the fifth-largest supplier of coal and iron ore. In contrast, energy-poor South Korea must import most of its resources from abroad.

In addition to the talks, a South Korean consortium led by Korea Electric Power Corp. (KEPCO) and Korea Resources Corp. (KORES) signed a memorandum of understanding (MOU) with Atomredmetzoloto Uranium Holdings (ARMZ) to jointly explore for the radioactive material, which is used to fuel atomic reactors.

South Korea operates 20 reactors domestically and requires an average of 4,000 tons of uranium each year, making it the sixth- largest importer in the world.

"The joint development deal can help ensure a steady supply of uranium and help raise the percentage of overseas resource materials that are controlled by local companies," a government official said.

In addition to the ARMZ deal, state-run Korea National Oil Corp. (KNOC) said it signed a MOU with Russia's autonomous Republic of Kalmykia to look for oil in the Caspian Sea.

The Korea Energy Economic Institute and Russia's Energy Systems Institute also signed a cooperative arrangement on the sidelines of President Lee's visit.

The pact calls for joint feasibility research to provide gas from eastern Russia to South Korea and greater cooperation between energy firms.

Originally published by Yonhap news agency, Seoul, in English 0557 29 Sep 08.

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