South Korea's state-run Korea Gas Corp. (KOGAS), the world's largest liquefied natural gas (LNG) buyer, is joining the Cordova Embayment natural gas project in British Columbia.
In May three of Japan's largest utilities joined a Mitsubishi Corp.-led consortium to partner with Calgary's Penn West Exploration's shale gas project in northeastern British Columbia (see Shale Daily, May 10; Daily GPI, Aug. 25, 2010).
Mitsubishi's portion of the joint venture is to become a public-private sector initiative to include Japan's listed utilities Chubu Electric Power Co. Inc., Tokyo Gas Co. Ltd. and Osaka Gas Co. Ltd., as well as state-funded Japan Oil, Gas and Metals National Corp. (JOGMEC).
Now KOGAS will join the group after Mitsubishi agreed to sell 5% of its 30% stake in the project, which has been estimated to hold up to 8 Tcf of gas reserves. Penn West continues to hold a half-stake in the project.
The consortium would allow the utilities to learn about shale gas and give them an interest in any future LNG exports.
Involvement by KOGAS would boost the project's exposure to South Korea, which is the world's second largest LNG importer after Japan. Output from the Cordova Embayment project is expected to average about 500 MMcf/d when it begins operations in 2014.