U.S. now supplying LNG to South Korea

Korea Gas Corp. and Cheniere Energy commenced a 20-year sales agreement to ship U.S. gas during the weekend.
By Daniel J. Graeber  |  Updated June 27, 2017 at 5:44 AM
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June 26 (UPI) -- A gas company from Korea, one of the largest buyers of liquefied natural gas in the world, said it commenced a sales agreement with a U.S. supplier.

The Korea Gas Corp. commenced a 20-year sales and purchase agreement with Cheniere Energy Inc., which operates the only facility in the United States with the permits necessary to export super-cooled LNG.

"This is just the beginning of a long and productive relationship that will be beneficial to both companies and both countries, and we hope to continue to grow this relationship between KOGAS and Cheniere," President and CEO Jack Fusco said in a weekend statement.

Cheniere last year became the first company in the United States with the permits necessary to ship LNG overseas. A special permit is needed to send natural gas to countries without a U.S. free trade agreement, a scenario that could present roadblocks for future LNG exports from the United States given President Donald Trump's protectionist trade policies.

The United States signed a free-trade deal with Korea in 2012, though Trump left the 12-nation Trans-Pacific Partnership trade agreement, brokered by his predecessor, during his first week in office.

In May, however, the Commerce Department announced advancements with China under a 100-day action plan. Among the agreements steered in part by U.S. Commerce Secretary Wilbur Ross was a decision to allow China, which doesn't have a free-trade agreement with the United States, to receive LNG.

The sales and purchase agreement between the Korean company and Cheniere was signed in January 2012. Under the terms of the arrangement, Cheniere makes enough LNG available for its Korean customer to meet about 10 percent of South Korea's total annual demand.

Polish Oil & Gas, known by its acronym PGNiG, took its first delivery of LNG from Cheniere earlier this month.

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