Many large Korean construction companies are moving to get a piece of the action as Saudi Arabia wants to partner with Korean builders in promoting the Neom City project. Yet, DL E&C, the No. 3 player in the Korean construction market, appears to have failed to jump on the bandwagon. DL E&C reduced the proportion of the overseas business and focused instead on the housing business at home, which probably served as a negative factor for the builder, analysts say.
Large Korean construction companies such as Hyundai E&C, Samsung C&T, Daewoo E&C, and Lotte E&C are signing contracts with the Saudi Arabian government regarding the Neom City project one after another. The project involves building a low-carbon smart city 44 times the size of Seoul near the Red Sea in northwestern Saudi Arabia. It will cost 700 trillion won.
Hyundai E&C, Hyundai Engineering, and Lotte E&C recently landed the Shaheen Project, the world’s largest petrochemical project, from S-Oil. This project is to build plans for petrochemical production, including ethylene and polyethylene (PE), in Ulsan with a total project cost of 9 trillion won.
Hyundai E&C will also join an underground tunnel project for The Line, which is part of the Neom City project. The Line is a project to build a forest of buildings with a height of 500 meters and a width of 200 meters in a 170-km section inside Neom City. The Korean builder has secured an underground tunnel-related construction project for The Line.
Daewoo E&C was given a promise to participate in the petrochemical upstream business in the oil and gas sector through an MOU with Saudi authorities.
However, DL E&C has not signed any deal regarding the Neom City project. The contractor was not included in One Team Korea, which was dispatched to Saudi Arabia by the Ministry of Land, Infrastructure and Transport in early November. One Team Korea had nine construction companies — Hyundai E&C, Hyundai Engineering, Samsung C&T, Samsung Engineering, Daewoo E&C, Hanmi Global, Ssangyong E&C, GS E&C, and Kolon Global.
