April 21, 2024

S. Korean firms win $7.2b gas plant deal in Saudi Arabia

PUBLISHED : April 03, 2024 - 10:22

UPDATED : April 03, 2024 - 10:22

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The signing ceremony of the Fadhili Gas Increment Program held on Tuesday (Yonhap)

Samsung E&A and GS Engineering & Construction (GS E&C) have won a combined $7.2 billion deal to expand a gas plant in Saudi Arabia, the biggest order for South Korean companies in the Middle Eastern country, the presidential office said Wednesday.

The Fadhili Gas Increment Program is a project run by Saudi Arabia's state oil giant, Saudi Aramco, to expand the capacity of an existing gas plant in an oilfield some 80 kilometers away from the city of Jubail in the country's east.

The deal is the result of an agreement reached during President Yoon Suk Yeol's state visit to Saudi Arabia last October to strengthen cooperation between the two countries in construction and infrastructure, the presidential office said in a press release.

It is also the third-largest overseas construction order won by a South Korean firm, after the $19.1 billion Barakah nuclear power plant project in the United Arab Emirates and the $7.7 billion Bismayah New City project in Iraq, it said.

Samsung E&A said in a statement that it had clinched a $6 billion deal to construct two gas treatment facilities as part of the plant expansion program.

It marks the single-largest contract in the company's history and the largest-ever deal that South Korean builders have obtained from the Middle Eastern country.

The completion of the project would raise the plant's daily capacity to 38 million MMSCFD (million standard cubic feet per day) from the current 25 million MMSCFD, it added.

Samsung E&A is currently participating in two gas treatment and storage facility projects in Saudi Arabia, which has been investing big in gas plants in a bid to boost gas production.

In a separate regulatory filing, GS E&C said it had bagged a $1.22 billion deal to build a sulfur recovery unit at the plant, which is expected to take about 41 months. (Yonhap)

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