Daewoo, STX, SK, Hyundai firms sign MOUs on major  construction projects


Korean companies have inked preliminary deals with Venezuela to participate in energy infrastructure businesses worth a total of $11.1 billion in the South American country, the Ministry of Knowledge Economy said Wednesday.

Seoul and Caracas also reached a framework agreement to have Korea Gas Corporation take part in a $10.4 billion project to develop liquefied natural gas fields in Venezuela.

Venezuela has the world’s second-largest crude oil reserve and the eighth-largest natural gas reserve.

A consortium of Daewoo Engineering & Construction and STX Construction signed a memorandum of understanding with Venezuelan state-owned petroleum company Petroleos de Venezuela S.A. on strategic cooperation for an $8.8 billion project to build an oil pipeline along the coast, a crude oil storage facility and a harbor for exports.

It will be the largest-ever construction deal for Korean companies in South America.

Daewoo and STX plan to establish a 50:50 joint venture and seal a contract on the basic designs with PDVSA within the first half of this year.

Hyundai Engineering and Construction inked an MOU with PDVSA to jointly push for construction of a $1 billion petroleum coke-fired power plant. The 900-megawatt plant will be built in Venezuela’s Carabobo of the Orinoco Oil Belt.

Hyundai E&C also agreed to jointly push for the $800-million initial-stage construction of an oil refinery in Junin of the Orinoco Oil Belt with PDVSA.

SK Engineering and Construction signed an MOU to build petrochemical facilities worth $500 million with PDVSA, and a letter of intent to collaborate with the Venezuelan state-owned petrochemical company Petroquimica de Venezuela S.A. for a $35 million Polinter Petrochemical project to build a petrochemical complex. The complex will have an annual production capacity of 800,000 tons of synthetic resins such as ethylene.

Lee Kwan-seop, the Knowledge Economy Ministry’s head of energy resources, and Venezuelan Deputy Minister of Energy Ivan Orellana sat through the signing ceremonies at the Gwacheon government complex and discussed the business plans in detail.

Seoul and Caracas also held their fourth resource cooperation committee meeting in Seoul on Wednesday, during which they discussed the petrochemical complex construction and advancement of refineries.

Lee asked Energy Minister Rafael Ramirez, who led the Venezuelan delegation, to pay more attention to Korean companies that have the world’s leading capabilities in carrying out plant and infrastructure projects.

The fifth bilateral resource cooperation meeting will be held next year in the Venezuelan capital of Caracas.

By Kim So-hyun (sophie@heraldcorp.com)