Korean construction companies are making progress in the market for international infrastructure projects.

Hyundai Engineering, along with Hyundai Engineering and Construction (E&C), announced on March 13 that they won a KRW 3.8 trillion deal to build oil refineries in Iran. The sister companies are now responsible for the construction of the second part of Phase 12 of the South Pars gas field project, along with the Ahdaf Investment Company, a subsidiary of the National Iranian Oil Company (NIOC).

It will take 48 months to build production lines for petroleum products such as ethylene, monoethylene glycol, high-density polyethylene and low-density polyethylene at the South Pars field, the world’s largest gas field, in Tonbak, a city 1,100 km south of Tehran.

Hyundai Engineering was invited to bid in 2015 when Iran was still under economic sanctions. The company launched a local office and frequently visited the government corporation and other partner companies to win the contract.

Daelim Industrial also won a construction contract in Iran on March 12. It signed a KRW 2.23 trillion contract with the Esfahan Oil Refining Company to improve oil refineries in Esfahan, a city 400 km south of Tehran.

The recent contracts in Iran are expected to bring new business opportunities to Korean construction companies. Because Iran is the world’s first and fourth in natural gas and oil reserves, respectively, the lifting of economic sanctions and a recovering oil price could increase the possibility of more contracts for energy-related facilities going to Korean contractors.

“We will pursue additional contracts by increasing our competitiveness in Iran,” said a Hyundai Engineering official.

Currently, Hyundai Engineering singed a basic agreement to build a combined cycle power plant in Zanjan with the Thermal Power Plants Holding Company, a subsidiary of Iran’s energy ministry, and is anticipating KRW 570 billion from the deal. Daelim is also expecting to win a KRW 2.28 trillion contract to build the Bakhtiari Dam hydroelectric power plant.

Hyundai E&C, Daewoo E&C, GS E&C and Samsung C&T are also in the running to construct hospitals, roads, railroads, petroleum plants and energy plants.

Meanwhile, Korean builders are cooperating with the Korean government to win contracts in countries other than Iran, too. The national support group, along with the minister of land, infrastructure and transport, Kang Hoin, will visit Turkey and Spain from March 15 to 22 to strengthen business partnerships there for large infrastructure projects.

In Turkey, the group will discuss with related institutions Korean companies’ role in building Turkey’s high speed railways, tunnels and canals. It will also visit the Turkish ministry of transport to sign MOUs on railroads, roads and R&D, to expand and actualize joint businesses in the two countries that they have worked on so far.

In Spain, the group will meet the Spanish minister of public works, CEOs from Spanish construction companies and the president of construction association, SEOPAN, to establish partnerships to work together on infrastructure projects in Spain and in Central and South America.

By Kim Young Shin
Korea.net Staff Writer
Photo: Hyundai Engineering
ysk1111@korea.kr