◎ South Korean companies win a contract for the largest plant in Turkmenistan
- The contract amount for this gas treatment plant is worth USD1.48bn (1.7 trillion won) on a turnkey basis
- The plant construction is expected to begin in January 2010 and be completed in Q3, 2012
- The plant will be constructed in Yoloten, in the southeastern region of Turkmenistan, the site of a super-large gas field
- The plant will produce 10bn cubic meters of natural gas through gas treatment and desulfurization processes
◎ Unprecedented Exploitation of Emerging Markets
- The business deal in Turkmenistan is significant since Turkmenistan is unknown country to South Korean companies
- The project lays the foundation stone for economic cooperation between Turkmenistan and South Korea
- This will promote to participate in other related businesses in the future The consortium of Hyundai Engineering and LGI has successfully won a contract for Turkmenistan's largest-ever plant.
■ South Korean companies win the largest contract in Turkmenistan
LGI (CEO: Koo Bon-joon) and Hyundai Engineering (CEO: Kim Dong-wook) together won a contract for a gas treatment plant worth USD1.48bn (1.7 trillion won) from Turkmenistan's state-owned company, Turkmengas.
The project, Turkmenistan's largest ever, is a turnkey-based deal that comprehensively includes engineering, procurement, and construction activities. The project will begin in January of 2010 and end in Q3, 2012. Once completed, the plant will produce annually 10bn cubic meters of natural gas through the desulfurization process, which is designed to remove sulfur from natural gas.
The plant will be located in the Yoloten region, southeastern Turkmenistan, containing the Yoloten-Osman natural gas field, which was discovered in November 2006 and is one of the world's five largest gas fields. A 2008 survey showed that the gas field holds 14 trillion cubic meters of natural gas, enough to supply to the world for five years. This discovery suddenly elevated Turkmenistan to a fourth country in the world in terms of natural gas reserves.
All costs for the project will be borne by the client, Turkmengas. Turkmenistan is set to continue to expand its gas treatment plants.
■ Unprecedented Exploitation of Emerging
Markets: likely to promote the two countries' economic cooperation
Resource-rich Turkmenistan had a long history of limited diplomatic policies, but it began to positively seek foreign investment in 2007 when President Gurbanguly Berdymukhammedov was inaugurated. Various countries, including China and Russia, are actively competing for business deals securing natural resources due to the world's fourth largest natural gas reserves of Turkmenistan.
Russian President Medvedev recently visited Turkmenistan to meet President Berdymukhammedov and concluded a strategic agreement regarding natural gas and various energy sources. Prior to this, Chinese President Hu Jintao visited Turkmenistan and attended a ceremony opening the world's longest gas pipe between Turkmenistan and China.
The ceremony attendees were Turkmenistan President Berdymukhammedov, Kazakhstan President Nazarbayev, Uzbekistan President Karimov and the leaders of other related nations.
LGI forecasted the potential growth of the emerging Turkmenistan market and established a branch office in the country's capital, Ashgabat, in 2007.
Since then, LGI has explored business opportunities with the country's government. Hyundai Engineering President Kim Dong-wook said, "This deal was successfully achieved because LGI has new market exploitation capabilities, and Hyundai Engineering has diverse overseas business experience in the Middle East, Africa, Asia, and Central and South Africa, its excellent engineering technologies and service quality, and its superior engineers."
He added, "We will endeavor to improve South Korea's national prestige in resource-rich Turkmenistan with our superior service quality."
LGI President Ha Young-bong said, "LGI's country marketing efforts targeting emerging resource-rich countries have come to fruition. By winning the contract, we have prepared a stepping stone to enter into additional gas plant projects and resource development fields. In this sense, the deal is significant."
He added, "Last year the two countries' governments signed an MOU to develop the infrastructure fields including construction, transportation and harbors. As such, this project is expected to pave the way for the promotion of the two countries' full economic cooperation."
This consortium, through this contract for the plant, will contribute to the economic development of Turkmenistan, and at the same time expand into related business fields such as the development of resources and the construction of SOC infrastructures with the possibility of stably securing profits.