S-Space College of Humanities (인문대학) Institute for Russian, East European & Eurasian Studies (러시아문화권연구소) 러시아연구 (Russian Studies) 러시아연구 Volume 22 Number 1/2 (2012)
남북러 가스관의 경제적 효과에 관한 연구: 한국의 경우
Study of Economic Impact of the SK-NK-Russia Gas Line: Case of South Korea
- Issue Date
- 서울대학교 러시아연구소
- 러시아연구, Vol.22 No.2, pp. 259-280
- This study breaks down the economic feasibility, from South Korea`s perspective, of using natural gas from Russia delivered through the SK-NK-Russia gas line. It seeks to find out the price level that would maximize welfare effects for South Korea when it purchases Russian gas, using a model that compares gas price with the price of LNG. The construction of the model means quantifying purchase price, logistics expenses, and passage charges; and assumes diversion of all gas imported for city gas use. Using the model, an import of 7.5 million tons of natural gas from Russia at $400/TCM results in a 22% reduction in heating costs per every gas-using household, while an import price of $300/TCM would lead to a reduction of 31.9%. However, assuming mistakes are made during the negotiation and a subsequent purchase price of $600/TCM, savings per household would be a minuscule 2.3%. Therefore, no meaningful economic benefit can be expected from a purchase arrangement where the ``North Korea risk`` is deferred to Russia while South Korea assumes the burden related to price and quantity. The model used shows that the high risk associated with North Korea notwithstanding, gas supplies that lack economic feasibility is simply not worth considering.