Hyundai E&C Wins Massive Order Worth US$4.8 Billion in Venezuela

Hyundai Engineering & Construction (Hyundai E&C) won a plant construction project worth approximately 5 trillion won (US$4.8 billion) in Venezuela. The total value of orders received by Korean builders during the first half of this year reached a record high of US$37.5 billion with the project, increasing the probability of meeting the annual goal of US$70 billion.

Hyundai E&C announced on June 30 that it obtained the Puerto la Cruz Refinery expansion and remodeling project with Hyundai Engineering and Wison Engineering, a Chinese company, from Petroleum de Venezuela (PDVSA). The contract amount is US$4.837 billion. Hyundai Engineering & Construction has 72 percent of the shares, while those of Hyundai Engineering and Wison Engineering are 18 percent and 10 percent, respectively.

During the course of the project, the facilities and equipment of the refinery located 250 km to the east of Caracas are remodeled for the production of high value-added petroleum products. The construction continues for 47 months from the groundbreaking.

The project is the third one in Venezuela for Hyundai E&C since the start of its business in the country two years ago. The company set up its Columbian branch in 2010, Venezuelan in 2012, Uruguayan in 2013, and Chilean earlier this year.

The company’s overseas performance for this year reached close to US$6 billion as of the end of June with the Chacao Bridge construction project in Chile and the Karbala Oil Refinery project in Iraq. Its goal for this year is US$11 billion.

In the meantime, the Ministry of Land, Infrastructure and Transport announced on June 30 that Korean builders won overseas orders worth US$37.5 billion combined between January and June. The amount is 21.5 percent higher when compared to the same period of last year, and US$1.1 billion higher than that of the first half of 2010, when the yearly total broke the US$70 billion mark.

By region, the Middle East accounted for 66 percent or US$24.74 billion of the total, with mega-scale plant projects such as the Clean Fuel Oil Refinery Plant in Kuwait worth US$7.15 billion. The regional amount jumped no less than 131 percent from a year earlier. In Asia, the number of large-scale plant and construction projects decreased and the amount dropped to US$6.21 billion, 49 percent of last year’s total. However, orders from the Latin American markets, including the BHP Combined Cycle Power Plant construction project costing US$440 million, are on the increase.

By project type, plant construction accounted for 85.2 percent of the total amount, while civil engineering and general construction took up 7.9 percent and 4.2 percent, respectively.

The Ministry is expecting that the yearly goal of US$70 billion will be met with ease with the signing of a US$12 billion project around the corner, and Korean companies participating in or preparing for US$110 billion worth of projects abroad. The Ministry is also planning to send delegations to this end to the Philippines, Hong Kong, Singapore, Spain, and the like and hold the Global Infrastructure Cooperation Conference 2014 in Seoul in September.