The five units of South Korea's utility giant Korea Electric Power Corp. (KEPCO) said Sunday that they are considering participation in the nascent Rajin-Khasan project logistics project in a bid to reduce the costs of importing coal from Russia through North Korea.

The Rajin-Khasan project, which is on a test run, is regarded as a starting point for economic cooperation among the two Koreas and Russia. Under the project, South Korea imports Russian coal through the North's port of Rajin to the South's Pohang port, some 374 kilometers southeast of Seoul.

The five KEPCO units, led by Korea Midland Power Corp., are reviewing the economic feasibility of the project. "But it is hard to say we will participate in the project as nothing has yet been decided," said an official at KEPCO.

Last month, a group of officials from the units, along with government officials, visited the North's Rajin port to assess the viability of importing Russian coal, industry sources said.

South Korea's leading steelmaker POSCO, a major shipper Hyundai Merchant Marine Co., and the state-run rail operator Korea Railroad are already taking part.

In the landmark pilot operation, 40,500 tons of Russian coal arrived in the South on a Chinese-flagged ship earlier this month from Rajin. The coal was transported from the Russian town of Khasan to Rajin on a 54-kilometer railway that was re-connected last year.

POSCO and the KEPCO units are expecting to reduce logistics costs of importing Russian coal by up to 15 percent if they participate in the Rajin-Khasan project.

North Korea holds a 30 percent stake in the Rajin-Khasan project with the rest being controlled by Russia. South Korean companies bought stakes in RasonKonTrans, the joint venture that manages the rail link.

The indirect investment allows South Korean companies to sidestep the blanket ban on conducting business with North Korea that have been in place since the North's sinking of a South Korean warship near the inter-Korean sea border in 2010. (Yonhap)