Subscribe
E-Paper
 |
| Korea South-East Power CEO Lyu Hyang-reol |
KOEN has claimed it did not know the origin of the coal, but skeptics say the company must have been aware at the time of the transaction, given the steep price difference between North Korean coal and that of other countries.
On Aug. 10, the Korea Customs Service (KCS) confirmed North Korean coal and other resources were brought into South Korea through Russia by fabricating the name of the country of origin.
The KCS has given the names of three importers and three companies to the prosecution for shipping the banned resources into the country. But it exempted KOEN and two commercial banks involved in payments, saying they were not aware the resources were from North Korea because documents were fabricated to show they were from Russia.
However, lawmakers and experts alleged the KCS was bending the rules for the power company.
According to KOEN data submitted to Rep. Yoon Han-hong of the Liberty Korea Party, the price of the coal KOEN purchased from a company that imported North Korean coal last Nov. 2 was $90.73 per ton, far lower than the $123.96 to $142.40 per ton suggested by other coal traders.
In its trading with KOEN, the importer of North Korean coal offered a per-ton price below $100, beating others, including Carbo One, one of the largest coal traders in the world, and bid the second-lowest price for the November import.
In November last year, the KCS investigated KOEN's deal with the suspicious importer, which is known to be a very small company with two or three employees based in Pohang, North Gyeongsang Province.
However, KOEN again purchased North Korean coal from the company in March at $93.92 per ton raising suspicions as to why it did not question the exceptionally low price, and the thoroughness of the KCS investigation.
"KOEN continued to import North Korean resources even after the KCS investigation, which is suspected to be impossible unless the government neglected or deliberately overlooked the issue," Yoon said. "Even though the price was lower than that suggested by one of the industry leaders, KOEN continues to make excuses that it just followed the principle of accepting the lowest bidder."
Rho Young-hee at law firm Chunil said: "The KCS exemption of KOEN can be interpreted as it had no decisive evidence to prove the company was aware the coal was from North Korea."
"However, there are plenty of circumstances casting suspicions on KOEN, such as the low price compared to the coal quality and the fact the company continued to import North Korean coal after the investigation," she said. "Another critical factor is that a peer power company reported a suspicious coal importer to the authorities. Does this mean KOEN was too incompetent even to question the origin of the purchase?
In March, the Korea East-West Power (EWP) canceled a coal deal with a company and reported it to the KCS, as the company was suspected of importing North Korean coal. The company that attempted to supply coal to the EWP reportedly has a close relationship with the importer supplying coal to KOEN.
KOEN was unavailable for comment.
