President Chae Hee-bong of Korea Gas Corp. (KOGAS) takes an oath before he testified at a parliamentary audit of the corporation by the National Assembly Trade, Industry, Energy, SMEs and Startups Committee on Oct. 14. (Photo: National Assembly of the Republic of Korea)

Korea Gas Corp. (KOGAS) plans to diversify sources of importing liquefied natural gas for which Korea heavily depends on the Middle East.

KOGAS President Chae Hee-bong disclosed this and other policies during a parliamentary audit of the corporation by the National Assembly Trade, Industry, Energy, SMEs and Startups Committee on Oct. 14.

The corporation plans to lessen the nation’s dependence on LNG import dependence on the Middle East and diversify import sources to areas such as the Atlantic region. Figures released by KOGAS showed that by source of origin, the Middle East region accounted for 44.9 percent of LNG imports as of 2018, followed by the Atlantic area, which took a 9.6 percent share.

KOGAS plans to secure alternative amounts by taking advantage of the buyer-dominating market situation in time for the expiry of conventional long-term contracts while striving to expand flexibility by scrapping restrictions on arrival spots and expanding rights to increase and reduce import amounts.

The global and Korean natural gas markets are normally affected by unusual weather conditions such as summer head spells and winter cold spells as well as geopolitical risks in the Middle east region and supply instability related to Long-distance transportation, so it is important to stabilize natural gas supply and demand and secure price competitiveness.

The corporation saw the error range of demand prediction pattern factoring in demand fluctuations such as sudden cold storms decline to 6 percent in 2018, a 3.1 percentage points improvement from 9.1 percent in 2017.

KOGAS has overhauled each site’s stock management regimes and will operate an intensive supply-demand management period between November and next February. The corporation is expanding supply-demand management tools like the introduction of a fuel substation contract system in which city gas is replaced with LPG temporarily and consumers are compensated for it.

The corporation plans to expand production and supply facilities in a timely fashion and revamp operation regimes to ensure safety and stability. It plans to increase production facilities from 72 storage tanks capable of containing 11.47 million kl in September 2019 to 31 units capable of 14.07 million kl by 2031. New supply network lines stretching 506 km in total length will be built, raising the combined length of supply network from 4,857 km in September 2019 to 5,363 km by 2023.

KOGAS President Chae Hee-bong told the committee the corporation has been devoting itself to enriching people’s lives and contributing to the development of the national economy by fulfilling its mission of improving people’s life convenience and public welfare through stably supply of natural gas.

President Chae said, “The natural gas industry is experiencing a more rapidly changing energy paradigm shift period than at any time ever in the wake of the recent post-climate change era.”

KOGAS, recognizing a heavy sense of the mission of the times, will do its best to ensure natural gas supply in an economical and safe fashion and the safe operation of facilities, he said.

President Chae said his corporation is aggressively conforming to the national task of building the world’s best hydrogen economy ecosystem through the expanding of investments in innovative growth sectors and leading the establishment of a fair economy such as shared growth with SMEs and revamping of unfair practices.