Will gas pipeline project improve inter-Korean relations?

The proposed project to build a pipeline to pump Russian gas to South Korea via North Korea is emerging as a major factor influencing inter-Korean relations.

The project was discussed at a summit between Pyongyang and Moscow and is also expected to become an agenda item of summit talks between Seoul and Moscow slated for November.

Some in Seoul even say the gas pipeline could lead to an inter-Korean summit and tripartite dialogue among the leaders of the two Koreas and Russia.

Hong Joon-pyo, chairman of South Korea`s ruling Grand National Party, mentioned the project Friday, saying, “The president is making a lot of efforts to improve inter-Korean relations.”

Using the expression “Wag the dog,” Hong said, “Through the wag, which is the gas pipeline project, we can solve the problem of the dog, which includes the North Korean nuclear issue, the Cheonan (naval) vessel and Yeonpyong Island.”

Former party chief Park Geun-hye also said Thursday, “Once the gas pipeline is laid, it cannot be easily severed. It will help bring peace to the Korean Peninsula.”

○ Working-level talks gain speed

Progress has been made in negotiations on the project between North Korea and Russia and between South Korea and Russia.

When North Korean leader Kim Jong Il was on his way home Aug. 26 after summit talks with Russian President Dmitry Medvedev two days before, North Korean Trade Minister Lee Yong Nam had talks with Russian Regional Development Minister Viktor Basargin in Pyongyang on bilateral economic cooperation.

Basargin will visit Seoul next month for a meeting of a bilateral economic, science and technology committee and discuss the project with his South Korean counterparts, including Strategy and Finance Minister Park Jae-wan.

Prior to this, the state-run gas company Korea Gas Corp. of South Korea and Russian gas giant Gazprom will have working-level talks based on the results of the negotiation between Pyongyang and Moscow.

A government official in Seoul said, “If walking-level talks among the two Koreas and Russia are held following dialogue between Pyongyang and Moscow and between Seoul and Moscow, the three countries can seal a memorandum of understanding that contains an agreement in principle on the gas pipeline project.”

Seoul and Moscow seek to hold summit talks on the sidelines of the East Asia Summit in November in Bali, Indonesia, and the Group of 20 meeting slated for the same month in Paris. Building on the results of working-level talks, leaders of the two countries are expected to discuss the project on these two occasions.

○ Host of variables for the project

South Korean officials, however, are taking a cautious attitude to the role the project will play in improving inter-Korean relations. One high-ranking official said, “The project needs a very long-term perspective,” adding, ”Even if the three countries begin negotiations, starting the project could take several years.”

Another government official in Seoul said, “Many North Korean risks existed in the process of constructing light-water reactors,” adding, ”Cutting it off halfway is not the only problem. A host of problems will emerge in the negotiation process alone."

The official alluded to the obstacles that riddled the construction of the light-water reactor project in the 1990s, such as the North’s detainment of construction workers for trivial reasons.

Another official also discouraged rosy prospects on the gas pipeline project, saying, “Considering that no progress has been made on the connection between the Trans-Siberian Railroad and the Trans-Korean Railroad, the (pipeline) project is out of the question.”

South Korea apparently thinks that the pipeline passing through the North should basically be discussed between Russia and the North, and will pursue the project in a way to have Russia assume the burden of minimizing risks stemming from the North.

A source in Seoul said, “Many safety devices are possible. One of them is to pay commissions to the North after gas delivery to the end users is confirmed.”

○ 740 kilometers of pipeline in the North

According to officials in Seoul, the length of the pipeline linking the three countries will be about 2,400 kilometers, of which 740 kilometers will pass the North from Rajin and Wonsan to the Military Demarcation Line. The diameter of the pipeline, which will transfer 10 billion cubic meters of natural gas a year, will be 1.7 meters.

Construction of the pipeline will take approximately two years and cost 4 trillion won (3.8 billion U.S. dollars). If the North demands a change in the route, the length of the pipeline, cost and construction period can significantly rise.

Pressurization and power transmission facilities are required to be installed at regular intervals and roads for management personnel should be built, so the overall cost can further rise, according to experts.,

Dr. Lee Seong-gyu of the Korea Energy Economics Institute said, “In addition to technological analyses, a huge difference can result in cost depending on how the project is carried out,” adding, “The first way we can consider is a joint project between Gazprom and (South) Korea, with the former being the main operator and the latter financing the project.”

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