SK E&S starts Operating Nation First U.S Shale Gas-Fueled Power Plant

SK E&S starts Operating Nation First U.S Shale Gas-Fueled Power Plant

SK E&S, the energy subsidiary of SK Group, has started operation of its new power plant running entirely on U.S. shale gas for the first time in the nation. It is the nation’s largest plant based on a single electricity generator. SK E&S is planning to generate and supply electricity at lower prices by directly importing raw materials with the price competitiveness. Moreover, the domestic energy industry’s introduction of U.S. shale gas can be interpreted as part of using President Donald Trump’s aggressive fossil fuel development energy policies.

Paju Energy Service, which is a wholly owned subsidiary to of SK E&S, announced on Feb. 1 that it began commercial operation of its high-efficiency natural gas power plant with a production capacity of 1,823 megawatt power in Paul, Gyeonggi Province.

Early last month, SK E&S imported 66,000 tonnes of shale gas from Sabine Pass LNG export terminal in Louisiana and the fuel has been used to run the Paju power plant. SK E&S was the first in Korea to bring in natural gas extracted from shale formations in the United States.

In addition to the purchase at the spot market like the one from Sabine Pass, SK E&S is also planning to bring in natural gas for power generation through medium and long-term contracts. The company will directly import 800,000 tons of natural gas annually for the next five years through its Gorgon gas project in Australia. Starting in 2019, the SK subsidiary will take in 2.2 million tons of shale gas from the Freeport LNG Export Terminal in the U.S. on a 20-year contract. SK E&S has imported 500,000 to 600,000 tons of natural gas annually from Tangguh field in Indonesia starting from 2005 and the fuel is used has been used to run the natural gas plant in Gwangyang.

An official from SK E&S said, “With the latest commercial operation of the Paju natural gas power plant, SK E&S can now produce a total of 3,000 megawatts, combining with the 1,126-megawatt capacity from a natural gas plant in Gwangyang.”

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