Tehran and Seoul are determined to boost economic ties by signing $20 billion worth of agreements during the three-day visit of South Korea's President Park Geun-hye to Tehran, said the country's Minister of Land, Infrastructure, Transport and Tourism Kang Hoin.
"The agreements will pave the way for broader bilateral relations. There are a lot of opportunities for cooperation with Iran and we are keen to tap into the country's market," Kang said after meeting Bijan Namdar Zanganeh in Tehran on Sunday, Shana reported.
"South Korea recognizes Iran's important place and plans to use it to develop bilateral ties," Kang said, referring to Iran's lucrative market of 80 million people, abundant natural resources and its strategic position in the region.
Tehran-Seoul's bilateral trade is estimated to stand at $6.1 billion in 2015.
Park landed in Tehran on Sunday at the head of a 230-member delegation of the nation's largest companies and organizations.
She is scheduled to meet President Hassan Rouhani on Monday in what marks the first visit of a South Korean president to Iran since the two sides established diplomatic relations in 1962.
The National Iranian Gas Export Company and the state-run Korea Gas Corporation rubberstamped the first of a flurry of MoUs Sunday on export of liquefied natural gas and exchange of knowledge.
------- Water, Electricity Deals
In his first high-level meeting in Tehran, the Korean minister discussed a wide range of issues with Energy Minister Hamid Chitchian on Saturday, with the two sides hoping to sign 15 memoranda of understanding in water and electricity sectors.
"Nine MoUs will be signed in the water industry and six in the power sector," Chitchian said.
A top-priority mission of the Koreans would be upgrading Iran's electricity network, which entails increasing the voltage of transmission in power lines to 765 kilovolts from 400 KV at present. A higher voltage is more economical, reduces wastage and improves transmission safety.
"Other agreements include the construction of Karoun-2 and Bakhtiari hydroelectric dams as well as three power plants that would be built under build-operate-transfer contracts," Chitchian added.
South Koreans are also expected to discuss the implementation of a long-disputed plan that calls for transferring water from a branch of Karoun River in Chaharmahal-Bakhtiari Province through a 64-kilometer pipeline to the central provinces of Isfahan, Kerman and Yazd.
The project, known as Dasht-e-Behesht Water Transfer Plan, has been subject to much debate and controversy among analysts and officials, but it has yet to get off the ground nearly a decade after it was proposed.
Kang said South Korean firms are interested in bankrolling Iran's energy projects, particularly in power production.
"The projects will be financed and carried out by the backing of the Iranian government and Energy Ministry," Kang noted. "Financial reports of Iranian companies should be studied to ease cooperation and investment for South Korean companies."
------- Oil, Condensates Exports
Iran's oil and gas condensates exports to South Korea have experienced a fourfold rise, reaching 400,000 barrels per day, Oil Minister Bijan Namdar Zanganeh said after meeting Kang on Sunday.
He added that Iran's crude shipment to South Korea, one of its traditional customers, has gone up by 300,000 barrels a day from around 100,000 bpd before the implementation of the nuclear deal between Iran and world powers in January.
Reuters reported last week that South Korea's crude imports in March fell slightly from a two-year high in February to 264,452 bpd. It did not specify whether the volume included condensates.
According to reports, South Korea is in talks to store 2 million barrels of Iranian crude oil and condensate in its tanks. State-run Korea National Oil Corp. has been in discussions with its Iranian counterpart over the joint storage deal.
Iranian crude and condensate may be stored at the KNOC-run storage facility at Seosan on South Korea's west coast, which has the capacity to store 11 million barrels of crude and 3.6 million barrels of oil products.
KNOC operates nine state-run oil storage sites that can hold 146 million barrels of crude and oil products.
Oil imports by Iran's top four buyers—China, India, Japan and South Korea—reached 1.56 mbpd in March, up 49.9% from a year ago, government and tanker-tracking data show.
Underscoring that there are still difficulties in making payments for the oil sales due to international banks' reluctance to enter the Iranian market, Zanganeh said "serious negotiations are underway to address the key issue as soon as possible".
Zanganeh also noted that Koreans have shown interest in playing a major role in mega projects, including Iran LNG, South Pars Phase 2 development plan, Bidboland 2 refinery, a natural gas liquids plant on Kharg Island as well as Bahman Geno Oil Refinery in Jask, to name but a few.
According to Zanganeh, bilateral talks are underway between the enterprises in two states, some of which have come to fruition.
Regarding liquefied natural gas plans, negotiations will continue as Koreans have accepted the prerequisite for purchasing LNG from Iran.
Zanganeh believes that exporting oil to the East Asian state can help promote cooperation between the two countries.
The next stage of expanding collaboration would be financing the initiatives, which will be dealt with in the shortest time possible.
