Korea to cut LNG supply

Korea to cut LNG supply

DUBAI (DOW JONES): State-owned Korea Gas Corp. is trying to cut back on its 1999 liquefied natural gas import commitments and has contacted at least four of its suppliers to reduce the number of cargoes scheduled under annual delivery programs, the weekly Middle East Economic Survey said Monday.

Kogas is holding talks with suppliers in Indonesia, Malaysia, Brunei and Qatar to try to reduce its lifting obligations by 15 cargoes - 10 from Indonesia, three from Malaysia and one each from Brunei and Qatar, MEES said. But it emphasized that talks are ongoing, and nothing concrete has been decided.

Low offtakes by state-owned Korea Electric Power Corp., or Kepco, are behind the move, MEES said. Kepco had originally agreed to buy 5.23 million metric tons of LNG from Kogas in 1999 and planned to consume 2.19 million tons of that amount by the end of May, MEES said. Instead, it only burned 1.64 million tons in the period.