GS E&C Sweeps Plant Projects

Company clinches largest single overseas plant project won by Korean builders in Abu Dhabi

GS Engineering and Construction Co. won the largest single construction project ever won by Korean builders overseas with the Ruwais oil refinery construction project in Abu Dhabi worth $3.11 billion, the company announced on Nov. 6.
GS Construction got the order from Abu Dhabi National Oil Co., run by the UAE government, involving the construction of an oil refinery RFCC facility, which catalyzes heavy oil to produce high value-added light oil, in the Ruwais Oil Refinery Complex located 250 km from Abu Dhabi, slated for completion in 2014.
The RFCC will be able to produce 127,000 barrels of light oil per day when it is completed, the company said. As a turnkey project, GS E&C will take charge of all stages of the project from designing and materials purchasing to construction and test-run.
The company expects its annual earnings will be increased by 900 billion won on average in the next several years due to the Abu Dhabi project, with its 3.8 trillion won overseas plant project target nearly doubled to more than 7 trillion won.
The company won the second stage of the Ruwais oil refinery facility construction project valued at over $10 billion. SK Construction won the first stage of the project worth over $2 billion. Samsung Engineering also won a fertilizer plant construction project worth $1.2 billion in the same complex, bringing the total amount of projects that Korean builders won from the complex within the two-week timeframe in October to 7.5 trillion won.























The Abu Dhabi industrial complex got the attention of the Korean construction industry when it awarded a number of large projects to Korean contractors like Hyundai Heavy Industries, Hyundai Construction and GS Construction, totaling 6.2 trillion won early in the year.
At the end of June, the company got the news that it won the 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, bringing the company two huge plant construction projects in a month worth $3.2 billion, or 4 trillion won. 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 gas plant construction, 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 the one 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 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 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 9 and 10 for five years since the company won the project in 2003.
He said he has a special affection for Iran, as he has worked in the country for such a long time to finish the project, going through ups and downs with his fellow workers at the project sites. Iranians have such a high regard for Chang and his colleagues that they are cited as the reason the company was able to win the project.
The Nos. 9 and 10 project segments were to be completed during the U.S. sanctions on Iran, 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. The Iranian people appreciated the company’s hard work to complete the project on time because many died from cold due to the shortage of gas for heating in 2007.
GS E&C, jointly with its consortium partner, won a gas liquefaction facility construction project worth 1.6 trillion won from POGC (Pars Oil and Gas Co.) in Iran, the company said.
The project is for stages 6 and 8 of the mammoth gas liquefaction facility construction project worth 1.24 billion euro (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 value, the company said.
The IGC, an Iranian engineering company, is the partner in the consortium. The signing of the contract took place at the National Iranian Oil Co. headquarters 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 project stages 9 and 10, 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. It added 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 reservoir of natural gas in the world. The fact that GS Construction won the project 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 this year, the company said. nw

Officials of GS E&C and Abu Dhabi National Oil Co. sign an agreement on an oil refinery RFCC construction project in Ruwais Oil Refinery Complex to be completed by 2014.

Officials of GS E&C and ADNOC pose together for a photo after signing an agreement for an oil refinery RFCC project in Ruwais Oil Refinery Complex in UAE.