(Bloomberg) -- One thing became clear on the fourth day of the White House’s “Energy Week”: South Korea is really, really into U.S. natural gas.
In less than 24 hours, South Korea’s energy companies had announced four partnerships with U.S. companies to explore opportunities in the U.S. natural gas business. Korea Gas Corp., the state-owned gas supplier, said it’ll look into potential investments in liquefied natural gas projects in Alaska, Texas and Louisiana. SK Group signed an agreement with General Electric Co. and Continental Resources Inc. to pursue shale gas developments.
It makes sense. South Korea is already one of the world’s biggest importers of LNG and has bought eight cargoes of U.S. gas from Cheniere Energy Inc.’s Sabine Pass terminal in Louisiana. While Sabine Pass is the only one sending shale gas abroad, dozens of terminals have been proposed along U.S. coasts to do the same. The exports have put the U.S. on a path to becoming a net gas exporter for the first time in decades.
President Donald Trump noted during an “Energy Week” event in Washington Thursday that South Korea leaders were visiting the White House. He said they’d be “talking about them buying energy from the United States of America. I’m sure they would love to do it.”
U.S. LNG may in fact play a big role in furthering South Korea’s energy policies. After the election of Moon Jae-in as president in May, the country is looking to transition away from coal and nuclear power in favor of cleaner natural gas-fired electricity generation. And buying more U.S. fuel could allow the country to smooth geopolitical disputes over unbalanced trade, Korea Gas Chief Executive Officer Lee Seung-Hoon said Sunday at the Sabine Pass terminal, where the company celebrated the start of an LNG contract with Cheniere.
“All of these projects are looking to find more long-term offtake in order to get the financial support they need to move forward," said Anastacia Dialynas, analyst at Bloomberg New Energy Finance, in a phone interview Thursday. South Korea “might even be pitting them against each other” by exploring several projects to “see who offers the best terms,” she said.
The Port Arthur, Texas, LNG export terminal is being developed by Sempra Energy and Woodside Petroleum Ltd., and Energy Transfer Equity LLC and Royal Dutch Shell Plc are planning the Lake Charles, Louisiana, one. The Alaska LNG export project is being proposed by the state’s Alaska Gasline Development Corp.
Spot LNG prices in Singapore traded at about $5.244 per million British thermal units Thursday, according to a Singapore Exchange Ltd. assessment. That’s down from more than $14 in October 2014 as production capacity rises and oil prices have tumbled.