A Russian-South Korean commission on economic, science and technical cooperation signed a protocol in Seoul Thursday as a complement to an interim finance agreement signed between the companies in February 2005, and a memorandum of understanding signed in September 2004 to develop the shelf.
The Kamchatka shelf is about two-thirds the size of South Korea and is estimated to hold about 900 million metric tons of fuel equivalent at 26 sites.
Rosneft holds a 60% share in the project, which can be compared to such major oil and gas projects as Sakhalin I and Sakhalin II. KNOC holds 20%, and the remaining 20% belongs to a consortium of Korea Gas Corp., GS-Caltex Corp., SK Corp, Daewoo International Corp. and Kumho Petrochemical and Hyundai Corp.
The first stage of the work on the shelf will take two and a half years and will cost $150 million. The Korean company will invest in prospecting operations, and Rosneft will be able to claim a share of the revenues once production begins.
The Federal Service for the Oversight of the Environment, Technology and Nuclear Management said the protocol also ensures further cooperation between Russian natural gas monopoly Gazprom [RTS: GAZP] and South Korea's natural gas company Kogas.
The Russian delegation informed the South Korean side of its preparations to form a single system in Siberia and the Far East, to produce, transport and distribute natural gas to meet the rising energy demands of Asian-Pacific markets.
