Major South Korean builders have clinched deals estimated at a combined US$5.4 billion for an oil refinery project in Kuwait, the largest overseas contracts won by construction firms so far this year, industry sources said Friday.
The firms, including South Korea's No. 2 builder Hyundai Engineering & Construction Co., have received letters of award for the New Refinery Project from the state-run Kuwait National Petroleum Company to build an oil refinery and related facilities in the region of Al Zour in the southern part of the Middle Eastern country, according to the sources.
The project, worth $14 billion in total, consists of five packages, four of which were won by consortia led by South Korean firms.
The second and third parts of the project, estimated at a combined $3.92 billion, were won by a consortium involving Daewoo Engineering & Construction Co. and Hyundai Heavy Industries Co.
Three other South Korean firms have also bagged deals in the first and fifth packages. Construction will last 45 months.
The mega deals are welcome relief as many builders here are struggling to improve their earnings amid an overall slump in the industry and a lack of orders from abroad.
"Oil-producing countries in the Middle East had been delaying or cutting back on new construction projects due to plunging oil prices, and so there has been a sharp decline in overseas orders," said an official from the International Contractors Association of Korea.
"With the latest Kuwait deal, builders may be able to make up for some of their lagging performance seen in the first half of this year."