REUTERS: Korea agrees big Kazakh energy deal

/REUTERS, September 20, 04/ - South Korea, the world's fourth-biggest oil buyer, signed a major energy deal with resource-rich Kazakhstan on Monday as part of Seoul's plan to diversify its energy sources. South Korea imports 2 million to 2.5 million barrels per day (bpd) of crude to run its economy, the world's 11th biggest, and support an export market led by such global brands as Samsung Electronics, LG Electronics and Hyundai Motor. Russia, where President Roh Moo-hyun heads later on Monday after a state visit to Astana, is a fast-growing market for South Korea, whose consumer goods are popular in Kazakhstan, too. But South Korea imports most raw materials and all its crude oil and natural gas and is keen to diversify supplies away from the oil-rich but volatile Middle East to others including Russia and Kazakhstan. "With the deal, we came to establish a bridgehead to secure oil from the oil- rich Caspian Sea," said a Roh aide by telephone from Astana. "We hope this deal will help us improve our self-sufficiency of energy," the aide said after state-run Korea National Oil Corp. (KNOC) signed a memorandum of understanding with Kazakhstan's state oil firm KazMunaiGas. The aide gave no value for the upstream oil project, but added it would aim to develop between 600 million and 800 million barrels of oil. Kazakhstan currently produces more than 1 million bpd of crude and condensate. Roh stopped in Astana en route to Russia, where the energy needs of Asia's third-largest economy are also expected to be a key topic, along with security issues, including North Korea and its nuclear weapons ambitions. URANIUM PROJECT A diplomatic source in Moscow said in addition to the Kazakh deal, one for a $2.6 billion petrochemical plant in Russia's Tatarstan region would be agreed in Moscow. Roh's four-day trip is the first in a series of profile-raising visits that will take him to a dozen countries by the end of the year. After arriving in Astana on Sunday, Roh met members of Kazakhstan's 100,000-strong ethnic Korean community, descendants of those Josef Stalin deported from the Soviet Far East to Central Asia in 1937. Koreans first emigrated to Russia's Far East 140 years ago. President Nursultan Nazarbayev gave Roh an impromptu 58th birthday present on Sunday by giving him a glimpse of his new capital city. Roh was taken to the 97-metre (320-foot) Baiterek glass ball-topped tower where he placed his hand on a gold imprint of Nazarbayev's hand, triggering music to thunder unexpectedly from hidden speakers. Roh plans to move his country's administrative capital from Seoul to a rural area to the south, with construction of the new, unnamed site to be completed in 2012. South Korea also signed a memorandum of understanding with Kazakhstan on a separate uranium development project. Seoul, which wants uranium from Kazakhstan and Russia for the 19 nuclear plants that supply 40 percent of its electricity, hopes to meet about 10 percent of its uranium needs from the project. [2004-09-20]