Switzerland's Vitol has entered into a long-term $3.4bn deal with Korea Midland Power of South Korea (KOMIPO) for the annual supply of 400,000 tons of liquefied natural gas (LNG).

KOMIPO, a unit of Korea Electric Power Corporation (KEPCO), will purchase the gas between 2015 to 2024, but the deal offers the company an option to buy more than the initially contracted volume, depending on changes in market prices.

The company said this is the first time a KEPCO unit has signed a deal to buy LNG directly from suppliers instead of purchasing from the country’s LNG supplier, Korea Gas Corp (Kogas).

The government has allowed companies to import LNG for their own consumption since 2001, but Kepco’s power generation units have so far been unable to find a supplier, reports the Wall Street Journal.

South Korea has four LNG terminals in operation, of which Kogas runs three.

Kogas also has a terminal in construction, with four tanks to be built by 2014.