Dominant Force in Gas Plant Projects

GS E&C's relentless assault on the world's gas plant construction project market pays huge dividend

GS Engineering and Construction Co. continues to push its international operations by raising its overseas project target to 8.8 trillion won more than half of its 16.215 trillion won total project target for this year, industry sources said.
The company has already secured 5.5 trillion won worth of projects overseas as of Oct. 31 and should have no trouble meeting the overseas project target, with 2 trillion won worth of overseas projects in the area of chemical engineering expected to be secured and 1 trillion won in additional infrastructure projects.
The company's success in overseas construction projects has been attributed to its successful results in securing gas plant construction projects in competition with builders, particularly those from the EU and Japan. Its steady progress into overseas markets can be attributed to its steady push and strengthened capacity for taking on a variety of construction projects.
The company, unlike its rivals, has a special director in charge of international operations, the Chief Global Officer, acting as the control tower for the company's overseas operations. President Woo Sang-yong is the first CGO and he has been doing a credible job, backed up by his experience as the former manager of the plant construction division.
The company has done well in Kuwait in particular, a country considered a blue ocean among oil-rich countries. The company won three large plant projects one after the other in Kuwait worth a total 1.4 trillion won. In April, the company won an LPG storage project worth 620 billion won from Kuwait Oil Corp., followed by the Wara Pressure Sustaining Facility Project worth 600 billion won and the Azure water refining facility project worth 200 billion won in August.
The Azure water refining plant project is significant for the company in that it is the first such project the company won outside Korea and may be a signal that the company will start to win more such projects in the Middle East, the biggest market for soft water treatment projects in the world.
The company plans on using M&As as another means to expand its reach. "If we successfully take over Inima from the OHL Group in Spain, our moves to diversify the operations to Latin America would be completed on a successful note, as the Spanish firm specializes in soft water treatment plant construction," Huh said.
President Huh Myung-soo said he expects that infrastructure projects in newly emerging economies and in oil producing countries in the Middle East will continue to be ordered even during the global economic slowdown.
GS E&C landed a subway construction project in Singapore valued at 400 billion won and a gasification plant complex construction project in Uzbekistan worth 660 billion won diverse projects in diverse regions of the world.
Since taking over the PTT LNG terminal project in Thailand in 2008, the company has made headway in the area of overseas gas plant construction projects, which has been a so-called blue ocean, establishing itself as a strong firm in the area both at home and abroad, which has been dominated by firms from the EU and Japan.
Most Korean builders have received subcontract projects from large international firms or have done supplementary projects thus far, but GS Construction has been able to crack the market due to its record of building gas plants in the Middle East, starting with the Ruwais gasification plant project valued at $1.2 billion in the UAE in July 2009, securing international recognition for its successful job. The company also won the SNDC gas plant project in Oman valued at $264 million in the same year, winning wider recognition for its excellent workmanship, Huh said.
The company is currently working on a green diesel plant construction project ordered by Takrier Co., an affiliate of Abu Dhabi National Oil Corp. (ADNOC), worth $1.14 billion, a project related to the need for production of low-sulfur diesel fuel, with the EU deciding to regulate the import of high sulfur diesel into EU member countries from 2012. nw

President Huh Myung-soo of GS Engineering and Construction Co.
Photo on courtesy of GS E&C

A petrochemical plant built by GS E& C in Iran, one of the many plant projects that boosted the construction company's global fame.
Photo on courtesy of GS E&C


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