SK E&C will enter Pakistan for the first time while seizing the right to a large-scale US$1.41 billion project to build a hydroelectric power plant with private investments.
SK E&C announced on December 4 that the global contractor signed a contract to acquire 89% equities in Kandia Hydro Power Company from ATL, a local company, in Islamabad, Pakistan on December 1.
Kandia Hydro Power is a special purpose corporation established to promote the Kandia River Hydroelectric Power Generation project. SK E&C and ATL will own an 89% stake and an 11% stake of the special purpose corporation, respectively.
The project is a BOT (build, operation and transfer)-type development type project to build a 545 megawatt (MW) super-large hydropower plant in Basin of the Kandia River in Khyber Pakhtunkhwa Province 340 km north of Islamabad, run the power plant for 30 years and transfer it to the Pakistani government.
SK E&C will not only undertake the construction of the power plant, but take part in operation after its completion. The project will cost a total of US$1.12 billion. It will take 60 months to complete the power plant. The builder aims to go into commercial operation in 2025.
This project is quite meaningful in that this marked the first time that SK E&C made a foray into the super-large hydroelectric power generation market dominated by Chinese companies for the first time as a Korean company. At present, the construction of power plants with a capacity of more than 500MW is dominated by Chinese builders in Pakistan's private hydroelectric power market. Korean construction companies are participating mostly in 100 MW hydroelectric power plant projects.