Hard-earned Respect Pays Off

Iranians remember GS E&C’s hard work to complete projects on time to supply gas to heat homes

GS Engineering and Construction Co. won a gas liquefaction facility construction project worth 1.6 trillion won from the POGC (Pars Oil and Gas Co.) in Iran jointly with its consortium partner, the company said recently.
The project is for the sixth and eighth stages of a mammoth gas liquefaction facility construction project worth 1.24 billion euro, or about 2.1 trillion won, out of which the GS Construction consortium won part of the project scaled at 1.6 trillion won, equivalent to 77 percent of the total project cost, the company said.
IGC, an Iranian engineering company, is the partner in the consortium. The signing of the contract took place at the National Iranian Oil Co. with President Woo Sang-yong, in charge of the Plant Construction Division, signing for GS Construction, while Managing Director Seifulla Jashnsaz signed for the Iranian side on Oct. 12.
The company said the planned gas plant will be built in Assaluyeh, Iran, where the company already completed the South Pars ninth and 10th stages of the project, and will be capable of producing 670,000 barrels of desulfurized gas per day.
The project will get underway in November and is targeted for completion in May 2015 following 42 months of work, the company said, adding that it had to beat 12 competitors in a grueling bidding war, securing a sound position in Iran, a nation endowed with the second largest reserves of natural gas in the world. GS Construction’s winning the contract is recognition of its competitive power in the area of gas production facility construction following its dominant position in such areas as oil refinery and petrochemical plant construction, the company said.
The new project has brought the number of such large projects that the company won in the Middle East to six so far this year, valued at 3.72 trillion won, very close to the overseas construction project orders target of 3.8 trillion won for the year, the company said.
At the end of June the company got the news that it won a gas liquefaction project worth $1 billion. In July, the company won $2.2 billion worth of a project from Abu Dhabi Industries Ltd. to build a facility for separating natural gas. The company also became the first construction firm in Korea to secure a wide value chain experience in the area of LNG plant construction, gaining a very advantageous position in the gas plant construction sector, an area whose expansion has outpaced oil refinery construction in recent years and is still growing. Construction firms from the United States, Europe and Japan have dominated the gas plant construction sector so far, but now GS Construction has been able to break the mold. Korean construction firms have only been able to operate in the sector as subcontractors to those construction firms from advanced countries.
Furthermore, GS Construction won the project on a turnkey basis, taking charge of all phases of the project including design, purchase and construction, securing a base to get more project orders in the gas liquefaction plant construction sector, which is regarded as a blue ocean for Korean construction firms.
Vice President Chang Moo-il, in charge of the plant project headquarters and who led the work to clinch the gas plant project for the company, feels there is no place on earth he can’t go for plant construction projects, which is why he goes on long extended trips abroad to visit project owners to explain what his company can do in terms of plant construction including technologies.
Chang visited practically all the countries in the Middle East, especially Iran, on numerous occasions since 2003 as he has been in charge of the company’s South Pars gas liquefaction plant construction project stages No.9 and No.10 for five years since the company won the project in 2003.
He said he has a special affection for Iran as he worked in the country for such a long time to finish the project. Iranians have a high regard for Chang, which was a factor in winning the project.
Project segments No.9 and No.10 were to be completed during a period when U.S. sanctions were imposed, making it difficult to finish on time. But GS Construction completed it on time in 2008 before the onset of winter so that the residents in the region would be able to heat their houses. They appreciated the company’s hard work to complete the project on time because many people died from cold due to the shortage of gas for heating in 2007. nw

A view of a petrochemical plant built overseas by GS E&C.

President Hur Myung-soo of GS Engineering and Construction Co.