Hyundai Engineering & Construction Company has been awarded a contract to build Saudi Arabia’s largest petrochemical complex, marking a promising revival of overseas contracts from the Middle East. The company announced on Saturday its agreement with Aramco, Saudi Arabia’s public petroleum and natural gas company, to construct an ethylene production facility and utility infrastructure as part of the $5 billion Amiral petrochemical complex. Located in Jubail, the Amiral project is the most significant of its kind in the country and represents the seventh-largest overseas project won by a Korean company.
The achievement resulted from an agreement reached at a bilateral summit between President Yoon Suk-yeol and Saudi Crown Prince Mohammed bin Salman in November last year. As a result of this new contract, Hyundai Engineering & Construction’s overseas construction orders exceeded the previous year’s total of $12 billion, reaching $13.7 billion in the first half of this year alone.
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Why It Matters
The announcement that Hyundai Engineering & Construction Company would build Saudi Arabia’s largest petrochemical resulted in a positive influence on the company’s shares, which saw a surge of over 15% early on June 26. The Amiral petrochemical complex project, estimated at $5 billion, also reflects a crucial development in South Korea’s global competitiveness of its construction industry.
This project also underscores South Korean companies’ enthusiasm for participating in Saudi Arabia’s booming construction sector. This interest aligns with Saudi Arabia’s plan to double the size and population of its capital city with total investments of $800 billion under its Vision 2030 plan. By securing this grand project, Hyundai Engineering & Construction Company has placed itself at the forefront of this mega-project.
Given the scale and complexity of the project, however, potential risks that Hyundai will face include cost overruns, delays and technical difficulties. Hyundai will need to manage a vast supply chain, handle a significant workforce and navigate potential logistical hurdles while grappling with economic headwinds that could impact the global demand for petrochemicals.
Hyundai Engineering & Construction Company has been awarded a contract to build Saudi Arabia’s largest petrochemical complex, marking a promising revival of overseas contracts from the Middle East. The company announced on Saturday its agreement with Aramco, Saudi Arabia’s public petroleum and natural gas company, to construct an ethylene production facility and utility infrastructure as part of the $5 billion Amiral petrochemical complex. Located in Jubail, the Amiral project is the most significant of its kind in the country and represents the seventh-largest overseas project won by a Korean company.
The achievement resulted from an agreement reached at a bilateral summit between President Yoon Suk-yeol and Saudi Crown Prince Mohammed bin Salman in November last year. As a result of this new contract, Hyundai Engineering & Construction’s overseas construction orders exceeded the previous year’s total of $12 billion, reaching $13.7 billion in the first half of this year alone.
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