Russian coal for South Korea via North Korea

The second trial run of the trilateral coal project between the two Koreas and Russia was set to begin last week, according to the Ministry of Unification (MoU), reports nknews.org. The Rajin-Khasan initiative has been expanded since the first attempt in November, and will see 140,000 t of Russian coal shipped to three different South Korean ports via Rason in the North Korea’s far northeast.

“The coal will be delivered to Dangjin on [April] 24, to Gwangyang on [April] 25, and to Boryong on May 9. Two ships will work for this project,” an official at the MoU, who remained anonymous told NK News.

According to the Ministry, two Chinese ships were to carry the coal to the South Korean ports. The first will make a delivery of 40,000 t to POSCO, while the other makes two trips delivering the remaining 100,000 t.

The project involves three large South Korean companies, shipping giant Hyundai Merchant Marine, Korail Corp, and steel maker POSCO. None of the companies commented on the news.

This time round, two South Korean power generation firms are also involved in the second trial run, Korea East-West Power and Korea Midland Power Corp.

“We are not actively participating this project, we just got the suggestion from the project authority and cooperated this time,” a representative from Korea Midland Power told NK News. “We haven’t decided to buy more coal or not … 50,000 t is not a considerable amount, as we use 14 Mt/y. It is too early to evaluate its economic feasibility, but we tried to negotiate for reasonable price.”

Representatives from POSCO and Korail were also visiting North Korea’s Rason area, according to the MoU. “They will investigate facilities at Rajin port such as berthing and processing capacities. Korail will figure out the technical issues of moving coals along Russia’s railroad,” the official added.

The project is seen as part of President Park’s Eurasia initiative, a project designed to increase infrastructure and trade by linking Asia to Europe by rail.

NK News goes on to report that “most forms of trade with North Korea are currently off limits to South Korean companies, as part of the May 24 Sanctions, put in place after the sinking of the ROKS navy vessel the Cheonan in 2010.

“South Korean authorities argue however the Rajin-Khasan project is not covered by the measures, and that its future is still undecided.”

“It is exempt from the May 24 measures as it is in our national interest. Whether this project will continue or not has not been decided, it will be announced after this trial,” the MoU official told NK News.

To get to the port of Rason, the coal is hauled from Russia along the recently-completed 54-km rail line which links the two countries.