S. Korea to give NK natural gas plant for pipeline: source

South Korea plans to build a natural gas power plant in North Korea in return for the latter letting a gas pipeline linking the South and Russia pass through North Korean territory, a source said Thursday.

According to the source from the ruling Grand National Party of South Korea, if the pipeline goes through the North, the South is considering building a power plant rather than offering cash that Pyongyang could misuse.

"North Korea has no reason to reject this offer considering its dire power shortages," the source said.

South Korean President Lee Myung-bak agreed with Russian leader Dmitry Medvedev to closely cooperate to ensure success of the pipeline, so debate has risen in Seoul on how to compensate Pyongyang. Certain voices warn that if Seoul pays between 100 million U.S. dollars and 200 million dollars in cash, Pyongyang might use the money to expand its nuclear and military facilities.

Without transparency in the North`s use of the funds, others say, South Korea and the U.S. could even argue over the pipeline project in addition to conservatives in Seoul.

"The key issues in the pipeline project are safety and the passage fee," told Won Hee-ryong, a member of the ruling party`s supreme council, at a party meeting. "Public consensus is necessary since public opinion will be divided if Russia gives the money paid by the South to the North in cash."

Therefore, Seoul and Moscow will likely include specific details on the proposed power plant in the North when they sign a contract for the pipeline and gas supply. Seoul`s plan is to pay cash to Moscow for the pipeline, while the latter will use part of the money to build a natural gas plant in the North.

The South would then provide part of the natural gas from Russia to the North, which would use the gas to generate power.

The source said it was in the same vein that Medvedev promised that Russia will take complete responsibility for the risks of the pipeline going through North Korea.

dnsp@donga.com