창작과 비평

 

Under the 1994 agreement, two civilian electricity-generating nuclear reactors were to be built by 2003, but construction has not even started. Bush officials are talking of abandoning the project. South Korea and Japan understandably object: They agreed to pay for the reactors and have spent $800 million and $400 million respectively on it.

 

Instead of abandoning both reactors, the United States should suggest cutting back to one while supporting a gas pipeline now under discussion that would be a bonanza for both North and South Korea. The proposed pipeline, which could be finished more quickly than the reactors, would run from gas fields off Russia's Sakhalin Island through North Korea to South Korea. Exxon-Mobil and a Japanese partner control the Sakhalin gas concession and will not pursue a pipeline through North Korea without White House approval.

 

South Korea could use gas from Sakhalin to offset its dependence on Middle Eastern petroleum. North Korea would get royalties for letting the pipeline pass through its territory and could tap into it to supply new power stations and fertilizer plants.

 

Using a combination of pipeline gas and nuclear power as a carrot, the administration would have the decisive economic leverage necessary to get North Korea to end its nuclear and missile programs and accept adequate inspection and verification guarantees.

 

Compared with the huge potential of Siberia, where gas reserves are expected to last for the next century, the reserves so far discovered along the east coast of Sakhalin Island are less spectacular, though their impact on the Russian Far East and adjacent areas of northeastern China, Korea and Japan is likely to be significant.

 

The grand total of proven Sakhalin reserves is 915 billion cubic meters. These reserves are divided almost evenly between the oil and gas concession areas off the northeast coast, known as Sakhalin I, where a multilateral consortium led by Exxon-Mobil plans to invest $20 billion, and Sakhalin II, to the south, where investments by Shell, Mitsui and Mitsubishi are likely to exceed $10 billion. Exploration in the Sakhalin seabed has been in progress since 1978, but development proceeded sporadically until late 2001, when Russia liberalized its tax and regulatory policies and Russian President Vladimir Putin's meeting in Texas with President George Bush signaled an overall improvement in Russian-U.S. relations. Soon after Putin left Crawford, Exxon-Mobil announced that it would spend $4 billion of its projected $20 billion on Sakhalin development within the next five years, Russia's largest single foreign investment commitment to date. At present, plans call for oil production to start at Sakhalin I in 2005 or 2006, but Exxon-Mobil will begin with gas production if either South Korea or Japan, or both, should decide to support the construction of gas pipelines from Sakhalin and make firm price commitments.

 

Russia favors the construction of a pipeline running from Sakhalin I through North Korea to South Korea, partly because the pipeline route would skirt the Khabarovsk, Primorsky-Krai and Vladivostock areas on the Russian mainland opposite Sakhalin, where the demand for gas is rapidly growing. Until now, these cities have been dependent on Chernobyl-type nuclear reactors that pose a safety hazard and costly LNG supplies transported over long distances from Siberia. Initially, they might not get much gas from a pipeline originating in Sakhalin I, since most of it would have to go to South Korean consumers who can afford to pay the prices necessary to make the pipeline profitable for Exxon-Mobil. However, as untapped additional gas reserves of some 1.4 trillion cubic meters are explored and developed in newly allocated concession areas known as Sakhalin III, IV, and V, there will be enough gas available to divert what is needed to Russian cities along the pipeline route as well as to nearby northeastern Chinese cities, notably Harbin and Darien, where there is a heavy demand for gas from petrochemical plants as well as consumers.

 

"If Exxon became serious about a pipeline from Sakhalin to Korea," said Mikhail Lipilin, vice president of Rozneftegaztroy, Russia's largest pipeline construction company, "Russia will support it because it would be in our long-term national interest, both in terms of our strategic interest in close relations with Korea and as a step toward the gasification of our Far East." Even though Russia is short of cash, added Alexander Fedorovsky, Director of Pacific Studies at the Institute of World Economy and International Relations (INEMO), Russia could help to make the project financially viable in various ways. Instead of repaying its $1.7 billion debt to South Korea in scarce foreign exchange, he suggested, Russia could pay by getting government-controlled enterprises to contribute part of the work on the pipeline or to provide a share of the gas.

 

Neither the precise routes from Kovykta and Sakhalin I, nor the capacity of the pipelines, have yet been decided. Still, it is clear that Sakhalin gas would be cheaper than Kovykta gas or LNG, though how much cheaper remains to be seen. The pipeline from Sakhalin I would not be more than 1,900 miles long, running along the east coast of Korea to its terminus near Seoul, where it would intersect with an existing South Korean gas network. The pipeline could be built within four years at an estimated cost of $2.7 billion. By contrast, another projected pipeline route from Kovykta near Irkutsk in eastern Siberia, which would run along the west coast of Korea to a terminus at Inchon, would be slightly over 3,000 miles long and would cost some $10 billion to build.

 

As it happens, it cannot be assumed that a Kovykta pipeline would cross through North Korea to the South. The Bush Administration is flatly opposed to such a possibility. In South Korea, retiring president Kim Dae Jung favored a route through North Korea as a way to cement North-South economic cooperation and to help Pyongyang resolve its energy crisis. But some of Kim's critics in the South want the pipeline to veer south of Dandong to Dalien, where it would go under the Yellow Sea directly to Inchon, bypassing North Korea, even though this would add 250 miles to the route and make the pipeline more expensive, especially since it costs more to lay pipeline under the sea than on land. South Korea formally asked China to support a route through North Korea in December 2000, Xhang Xin, Director General of the China National Petroleum Corporation, told me in Beijing. "That is our policy, even though some South Koreans have come to us saying that they would prefer the undersea route," he said. "They think it's less risky politically. Like the Americans, they're afraid North Korea would have a stranglehold over the South if the pipeline goes through the North."

 

Ironically, North Korea itself is cool to the Kovykta project. Given China's burgeoning demand for gas, observed Song Bok Ku, Commercial Counselor of the North Korean Embassy in Moscow, Beijing will not be willing for very long to let Kovykta gas go to Korea. Whatever short-term commitments it might make, he said, "as time goes by, there will be little left for North and South Korea." South Korea's Ko Gas has sent two missions to Pyongyang to keep North Korean petroleum officials abreast of progress on Kovykta and to conduct preliminary surveys of a possible pipeline route. North Korean officials have promised to keep an open mind on Kovykta until a feasibility study is completed next July. But the North strongly prefers a pipeline from Sakhalin and has repeatedly conveyed this preference to Russia, most recently during Kim Jong Il's fourth meeting with President Putin at Vladivostock last August.

 

Even before the North Korean revelation on October 4, many observers have long believed that the Bush Administration will never build the reactors and have questioned the reactor project on economic grounds, anyway, arguing that the United States should offer to support the pipeline if North Korea agrees to drop the reactor project and to comply with U.S. demands relating to its nuclear and missile capabilities.

 

The most explicit proposal for such a deal has come from Bradley O. Babson, a Senior Consultant to the World Bank on East Asia. Babson told a Seoul conference on March 6, 2002, that the 1994 North Korea-U.S. nuclear freeze agreement "is very likely headed for a crisis." The crisis could be triggered, Babson said, by any or all of three contingencies: an impasse over inspection issues; the unwillingness of KEDO members (South Korea, Japan, the European Union and the United States) to pay for completing the reactors; or, most probably, by their refusal to cover the costs of the new power distribution grid that would be needed to transmit the electricity produced by the reactors.

 

Babson did not foresee that the crisis would result from North Korean acknowledgement of a secret nuclear weapons effort. But his warning was nonetheless prescient, and he made a proposal for a bargain with North Korea that the United States should now adopt, with important modifications, as I will explain later. If North Korea satisfies the United States that it has ended its nuclear and missile programs, Babson suggested, Washington and the multilateral development banks should be prepared to help finance not only the construction of the pipeline itself but also gas-powered power plants, gas-based fertilizer factories and rehabilitation of the existing North Korean power distribution grid. "The idea of building a gas pipeline to cross North Korea and serve the South Korean market is worth serious consideration," he concluded, "not just from the point of view of meeting South Korea's future gas requirements through regional energy cooperation," but because "it could transform inter-Korean relations and advance the larger goal of regional security."

 

Supporting this view, a leading expert on Northeast Asian energy issues, Keun Wook Paik, author of Oil and Gas in Northeast Asia (Royal Institute of International Affairs), points out that the cost of building the reactors ($4.9 billion) would greatly exceed the projected $2.7 billion cost of the Sakhalin pipeline. Gas could begin flowing well before the reactors are likely to start producing and transmitting electricity, he adds, assuming that Exxon-Mobil can reach agreement with South Korea on the price of the gas and the annual volume to be purchased. Once the feasibility study is completed this summer, he says, Seoul will have firm evidence that Sakhalin gas would be cheaper. Negotiations with Exxon-Mobil could then be completed by the end of the year, opening the way for the start of gas production, as scheduled, in time for the completion of the pipeline by late 2006.