South Korea Eyes To Buy LNG From Australia

South Korea said it's interested in buying liquefied natural gas from Australia's Browse Basin as Asia's fourth-largest economy competes with China and India for energy supplies.

South Korea expressed its interest to Australia regarding LNG supplies from Browse and the two countries agreed to increase cooperation on the project, Korea's Ministry of Commerce, Industry and Energy said yesterday. Korea's energy minister, Chung Sye-kyun, and his Australian counterpart, Ian Macfarlane, met in Canberra yesterday.

Korea is competing with China and Japan for LNG, a cleaner alternative to coal and crude oil, as energy prices climb. Korea is trying to reduce its dependence on crude oil after prices of the fuel rose to an all-time high of $78.40 a barrel in New York this year.

Woodside Petroleum Ltd.'s proposed Browse LNG project, located off northwestern Australia, will have the capacity to produce as much as 15 million metric tons a year of LNG and is due to start production in 2012-2014. BHP Billiton, BP Plc, Chevron Corp. and Woodside's 34 percent shareholder Royal Dutch Shell Plc have stakes in the venture.

The project, which may cost about $13 billion to develop, according to a Nov. 17 JP Morgan Chase & Co. report, is intended to tap fields that hold about 20 trillion cubic feet of gas and about 300 million barrels of condensates.