South Korea clinched key agreements with Kazakhstan Thursday on two US$4 billion projects to build a thermal power plant and a petrochemical complex in the Central Asian nation.
After summit talks between South Korean President Lee Myung-bak and Kazakh President Nursultan Nazarbayev, the two sides signed an “inter-government agreement” guaranteeing South Korea’s 70-percent stake in a $4 billion project to build a coal-fired power plant in the southern city of Balkhash., South Korean (Yonhap) News Agency reported.
Korea Electric Power Corp (KEPCO) and Samsung C&T currently hold a 35-percent stake each in the project to build a 1,320-megawatt plant that is expected to generate about 7 percent of Kazakhstan’s electricity needs.
Officials said that the intergovernmental guarantee is a must to make sure that the terms of the contract will remain effective regardless of changes to the law in Kazakhstan and to ensure that the Kazakh government will buy electricity from the plant.
In addition, South Korea’s LG Chem and Kazakhstan Petrochemical Industries (KPI) also signed a contract to establish a joint venture to push for a $4 billion project to build a petrochemical complex in Atyrau on the northern banks of the Caspian Sea.
The two agreements were the largest-ever since South Korea and Kazakhstan forged relations in 1992, and the latest achievement of Lee’s three-nation Central Asian tour that already took him to Mongolia and Uzbekistan.