40,500 tons of Russian coal to arrive in S. Korea via N. Korea next week

40,500 tons of Russian coal to arrive in S. Korea via N. Korea next week. November. 22, 2014 03:37. .

Some 40,500 tons of coal from a Russian mine will be imported to South Korea via North Korea on next Saturday, marking the first result of the Rajin-Khasan project among the two Koreas and Russia. Experts say that import will be a prelude to the lifting of Seoul`s May 24 sanctions on Pyongyang that imposed a virtual ban on inter-Korean economic exchanges.

Under the first pilot transportation test under the Rajin-Khasan Project, the 40,500 tons of coal from a mine in West Siberia will be transported to the North Korean city of Rajin next Monday via Vladivostok and Hassan. Then, the coal will be shipped on a Chinese 56,000-ton bulk carrier, which will leave Rajin on Friday and arrive in Pohang, North Gyeongsang Province in the South on Saturday.

An official at Seoul`s Unification Ministry said Friday that it has approved visits to Pyongyang by one government official and 12 officials from South Korean companies participating in the consortium for the project. The Korean inspection delegation will conduct technical inspections with Russian Railways of the overhaul process for a land and maritime logistical complex linked to Rajin Port.

South Korean steelmaker Posco, which imports the Russia coal, will pay 4 million U.S. dollars to the RasonConTrans, a North Korea-Russia joint venture. In accordance with 7:3 ownership ratio, North Korea will receive 1.2 billion dollars. If so, it would be the first time that South Korean money will be transferred to the North since Seoul`s May 24 sanctions imposed on North Korea in 2010.

A Seoul official said that the deal is a "normal international commercial transaction" and a "special case" under the May 24 sanctions.

The South Korean government offered financial support for companies reluctant to participate in the Rajin-Khasan project due to concerns over instability in business projects involving the North.

"Seoul is approaching the Rajin-Khasan logistical project as an attempt to build inter-Korean trust at an early stage," said a researcher at a state-run think tank in Seoul who asked for anonymity. "Russia`s involvement would provide Seoul an excuse for circumventing the May 24 sanctions that affect only bilateral issues between the South and the North."