Korea-Kazakhstan Summit
South Korean President Park Geun-hye and her Kazakh counterpart Nursultan Nazarbayev announced on June 19 a common communiqué to work closely together for realization of the major energy and power projects currently underway, as well as further cooperation for new energy projects between the two countries.
The new projects include a contract under which South Korea would provide the Kazakhstan Electricity Grid Operating Company (KEGOC) with US$18.8 billion worth of electricity for 20 years, which will be produced from the Balkhash coal-fired power plant under construction by Samsung T&C. The deal is expected to help finance the plant project and help launch its construction in the second half of the year. One official in Cheongwadae, the Korean presidential office, said, “This project is the first build-operate-transfer (BOT) project in Kazakhstan,” adding, “The project financing will be completed within the year, and the construction of the plant will be finished on April, 2019.”
South Korea also signed a total of US$5 billion in new energy projects including a US$3.5 billion project for expansion of the Tengiz oil field on the shores of the Caspian Sea. South Korea will also be taking part in the joint exploration of a lead and zinc mine in Karagandy Province, central Kazakhstan, with the aim of winning the rights to exploit the mine.
Due to the new projects, the total value of economic cooperation between the two countries has come to reach US$33.1 billion when these projects are grouped together with three existing major projects such as a US$4.9 billion coal-fired power plant in the southern Kazakh city of Balkhash, a US$5 billion project to build a petrochemical complex in Atyrau on the northern banks of the Caspian Sea, and a project to drill oil from the Zhambyl field in the Caspian Sea. In particular, President Park asked the Kazakh counterpart for his continued support in the continuous exploration of the Zhambyl oil field, with the aim of beginning actual drilling. An initial study put the field’s reserves at 100 million barrels, but the two sides have yet to determine its economic feasibility.
Park and Nazarbayev also agreed to expand bilateral cooperation to new areas such as health, forestry and infrastructure construction as part of efforts to promote their countries’ mutual growth and contribute to Kazakhstan’s industrial diversification.
Kazakhstan is the largest destination of South Korean investment in the region, with more than 250 South Korean firms operating there. Last year, the two-way trade reached a record US$1.32 billion.
President Park arrived in Kazakhstan on June 18 following a three-day state visit to Uzbekistan. After three days in Kazakhstan, Park is scheduled to fly to Turkmenistan on June 20 for a two-day state visit.