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Korean interest in North blown out of proportion: adviser
Korean Gas Corporation visit meant to be low-key, MGM Energy investment "modest"Thandiwe Vela Northern News Services Published Monday, July 11, 2011
KOGAS Canada Ltd. (KCL) adviser Andrew Palmer says he was surprised that a visit to the Mackenzie Delta by the South Korean national gas company, known as KOGAS, and a "modest" Arctic gas investment resulted in reports of the Koreans possibly sparking a Northwest Territories gas boom. A KOGAS contingent, including president and CEO Kangsoo Choo, raised national attention when it travelled to the region in early January, on a fact-finding visit. "I was trying to conscientiously keep a low profile of our visit," Palmer said, which was planned in accordance with advice from aboriginal groups who have been offended by companies in the past. "They would far rather us go slowly and methodically and simply introduce ourselves," he said. "We were not specifically on a shopping trip. We did not go there looking for an immediate opportunity." Palmer said Choo has had a longterm interest in the Arctic as a supply point for the national energy needs in South Korea, and has also spoken with Russian President Vladimir Putin, with an eye to potentially acquire assets in the Russian Arctic. In February, KCL closed a $30-million deal with MGM Energy, to acquire a 20 per cent share of their Umiak natural gas asset in the Mackenzie Delta. "We've just done this very modest purchase with MGM," Palmer said, adding the work plan for that asset is in the context of the Mackenzie gas pipeline and whether or not there will be a decision to construct. "This is definitely low speed at the moment, and not really high on the headquarters' radar," Palmer said. "KOGAS has global activity in liquid natural gas acquisition, so as an energy source imported into Korea, this is one piece of a very big puzzle." South Korea currently gets most of its natural gas from the Middle East, and Palmer says KOGAS is aware that by ship, Qatar is about the same distance away as the NWT. Minister of Industry, Tourism and Investment Bob McLeod says sourcing liquid natural gas from the territory would be advantageous for KOGAS because the hamlet of Tuktoyaktuk is actually closer to Seoul than Qatar. When KOGAS visited the Mackenzie Delta in January, Choo rode with Tuktoyaktuk Mayor Mervin Gruben on the ice road to the hamlet's community centre, where they enjoyed a fish chowder lunch. The mayor said the hamlet's hopes to develop a natural gas well and eventually convert the entire community from diesel to natural gas was discussed at dinner. He said KOGAS expressed interest in helping the community with their gasification, although there has been little correspondence on the matter since. "That is something that perhaps is under consideration at headquarters in Korea," Palmer said, "but there have been no commitments through our office. "The door is open for any relationships in the future and we certainly want to have positive relationships," Palmer added. KOGAS Canada Ltd. is a wholly-owned subsidiary of KOGAS, which was formed in February 2010.
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