Stable Supply from Russia
Korea Midland Power Co. (KOMIPO) announced on September 19 that it signed a bituminous coal purchase contract and a memorandum of understanding (MOU) for a preferential coal supply with Russia’s Mir on the 2nd (local time) during President Park Geun-hye’s visit to Russia.
The company’s new 2,000 MW thermal power plant in Boryeong and another new 1,000 MW thermal power plant in Seocheon will be completed after 2017. After that, KOMPIO’s annual bituminous coal consumptions are expected to increase by 7 million tons from the current 13 million tons to 20 million tons. With the latest agreements, the company has now secured a reliable source of bituminous coal, which Korea depends entirely on imports since it doesn’t exist in the nation.
In particular, Russia, one of major bituminous coal exporters, accounts for about 11 percent of the total global coal exports. Since the country is geographically closer than Australia, which currently exports bituminous coal to Korea, Japan and Taiwan, the bituminous coal demand-supply stability will significantly improve, KOMIPO said. When Korea imports bituminous coals from Australia, it takes 28 days to receive it by ship. When the country imports it from Russia, it takes only six days. Mir, the third largest mining company in Russia, produces 35 million tons of coal a year at eight mines in the Kuzbass region and exports the products to numerous countries including Korea and Japan through the Vostochny Port, the largest port in the Russian Far East and the ice-free port.
Meanwhile, KOMIPO also signed a cooperative MOU with Mir for preferential coal supply. Under the agreement, the company can preferentially receive high quality products from Mir through the Vostochny Port, the closest coal loading port, when its supply and demand of bituminous coal becomes temporarily unstable.