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Korean Companies Secure $12.2 Billion Plant Projects in Kuwait
Victory in Kuwait
Korean Companies Secure $12.2 Billion Plant Projects in Kuwait
  • By matthew
  • February 13, 2014, 03:50
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The Mina Al Ahmadi refinery of Kuwait, in which much of the infrastructure upgrades will be performed.
The Mina Al Ahmadi refinery of Kuwait, in which much of the infrastructure upgrades will be performed.


South Korean builders on February said their consortium won a US$12.3 billion oil refinery and petrochemical plant project in Kuwait.

According to sources in the construction industry on February 12, Korean construction companies received a Letter of Agreement (LOA) for implementation of three out of a total of six packages for the Clean Fuels Project (CFP), which was ordered by the Kuwait National Petroleum Co. Package 1 was obtained by the consortium of GS E&C and SK E&C, Package 2 by Samsung Engineering, and Package 3 by the consortium of Daewoo E&C and Hyndai Heavy Industries. 

The CFP is for an update of eco-friendly production systems at the existing Mina Al Ahmadhi (MAA) and Mina Abdullah (MAB) facilities, so that sulfur content of petroleum products will fall under 5 percent when work is completed. The US$12 billion project calls for the expansion of combined oil refining capabilities from 715,000 barrels to 800,000 barrels per day.

The five South Korean builders taking part in the CFP have won around US$7.1 billion worth of orders, or 69 percent of the total.

The US$4.82 billion MAA order, one of three development packages, was secured by a consortium of GS E&C, SK E&C, and Japan’s JGC Corp. All three partners have equal stakes in the work, starting the project in March and completing it by November 2017.

GS E&C will handle the hydrogen production unit and gas oil desulfurization, while SK E&C will build the sulfur recovery unit and the delayed coking unit. The Korean builders said that they will be in charge of design, purchasing, and construction work as well as carrying out trial runs for the project that will be undertaken 45 kilometers south of Kuwait City. This consortium is very meaningful in that South Korean companies engaged in cutthroat competition against each other, unlike previous bids. The results are that the companies secured orders despite losses.

Samsung Engineering said it obtained the No. 1 MAB package worth US$3.8 billion as part of a joint venture with Britain’s oilfield service provider Petrofac and CB&I. It said Samsung holds a 43 percent stake in the joint work, following Petrofac’s 47 percent stake. They will be responsible for setting up a crude distillation unit and hydrocracker facilities during the 45-month-long building process.

Daewoo E&C, which formed a tie-up with Hyundai Heavy Industries and leading US engineering and construction company Fluor, won the No. 2 MAB building package worth US$3.4 billion.