[Let's Run Again Construction Korea] 'Team Korea' Breaks European Pride... Hyundai ENG Builds Poland's Largest Petrochemical Plant

Hyundai Engineering, Poland Police PDH·PP Plant Project

Total Project Cost 1.4 Trillion KRW... Annual Production of 400,000 Tons of Polypropylene Upon Completion
Largest Petrochemical Plant Project Won by a Korean Construction Company in the EU
KIND under Ministry of Land Participates in Investment... Secures Victory Amid Competition with Leading Overseas Construction Firms
New Market Development and Basic Design-Based Sales Strategy Effective... Results in Indonesia, Russia, and More

[Asia Economy Reporter Yuri Kim] The Police region, located about 460 km northwest of Warsaw, the capital of Poland, is currently the site of the largest petrochemical plant construction in Poland's history. Hyundai Engineering is carrying out a large-scale project called the 'Polimery Police PDHㆍPP Plant' here. The project, which began in August last year, has completed basic groundwork such as foundation work and is now progressing with the main construction, including steel structure and piping installation.

The total project cost amounts to 992.8 million euros (approximately 1.4 trillion KRW). Upon successful completion, the site will house facilities capable of producing 400,000 tons of polypropylene annually along with auxiliary infrastructure. The PDHㆍPP plant produces propylene through the propane dehydrogenation (PDH) process from propane gas, and then combines the produced propylene with ethylene to manufacture polypropylene (PP). Polypropylene is a fundamental material widely used across various fields, from automotive interior and exterior parts, synthetic fibers, to various daily necessities and industrial products. The polypropylene produced through this project is expected to significantly contribute to Poland's economic development through domestic sales and exports.

◆The Largest Scale Plant Among European Orders in the Construction Industry

The Polimery Police PDHㆍPP Plant project undertaken by Hyundai Engineering is the largest petrochemical plant project ever awarded to a Korean construction company in a European Union (EU) country. The industry expects this project to accelerate economic cooperation in the construction sector between Korea and Poland.

Korea and Poland have maintained exchanges in various fields such as economy, politics, and culture. Last year marked the 30th anniversary of diplomatic relations between Korea and Poland. Since joining the EU in 2004, Poland has experienced steady economic growth. Notably, in 2018, Poland recorded the highest economic growth rate among EU countries, making it one of the fastest-growing countries in Europe.

Poland's central location in Europe offers a geographical advantage as a foothold for Korean companies entering the European market. With relatively low labor costs and strengths in manufacturing, large-scale investments from domestic companies continue. For these reasons, Korean construction companies that have entered EU countries have mainly undertaken construction projects for factories and office buildings of automobile, tire, and electrical and electronics companies. The industry expects Hyundai Engineering's large-scale project to serve as a starting point for breaking down entry barriers for Korean construction companies in the European region.

◆'Overseas Construction Team Korea'... Synergy Through Public-Private Cooperation

This project is notable not only because Hyundai Engineering is performing comprehensive engineering, procurement, and construction (EPC) but also because it is an investment-development type project with Hyundai Engineering participating as a joint equity investor. The Korea Infrastructure Investment & Development Corporation (KIND), a joint investment institution under the Ministry of Land, Infrastructure and Transport, also participated as an investor. KIND's investment amounts to 57 million USD (approximately 68 billion KRW), marking its largest investment since its establishment. Additionally, the total joint investment by Hyundai Engineering, Azoty, and Lotos in the form of equity and shareholder loans reaches 733.3 million USD.

KIND's investment participation is recognized as a representative case demonstrating the capabilities of the 'Overseas Construction Team Korea.' KIND's active expression of investment intent during the bidding phase was a decisive factor that allowed Hyundai Engineering to gain an edge over prominent overseas construction companies from France, Italy, and other countries. The industry views KIND's policy support combined with Hyundai Engineering's technical expertise and sales capabilities as a synergy that enabled the successful award of the contract amid competition with foreign construction firms.

A Hyundai Engineering official stated, "The Polimery Police PDHㆍPP Plant project is significant as it is not only Hyundai Engineering's but also the largest petrochemical plant project awarded to a Korean construction company in Europe," adding, "We will successfully complete this project to demonstrate Hyundai Engineering's execution capabilities."

◆Sales Strategy Success from FEED to EPC

Hyundai Engineering has been showing continuous success in new market development and sales strategies based on front-end engineering design (FEED). Adapting to changes in the business paradigm, the company has expanded its strategy beyond Central Asia and the Middle East to various countries including Europe, Southeast Asia, and the United States. As a result, since last year, new market development strategies have borne fruit not only with the Polimery Police PDHㆍPP Plant in Poland but also with projects such as the Balikpapan refinery in Indonesia, methanol plant FEED in Russia, and the Rosemary gas processing facility FEED in Malaysia.

Hyundai Engineering evaluates that the transition in the sales paradigm?from plant feasibility analysis to FEED to EPC main contract award?is yielding results, based on its abundant FEED experience and successful EPC project completions linked to FEED. A Hyundai Engineering representative said, "We will focus our technology, personnel, and experience to help the company establish itself in the European plant market," and added, "We will do our best to make this project a cornerstone of economic cooperation in the construction sector between Korea and Poland."