Three Consecutive Years of Awards Following 2018 Turkey Canakkale and 2019 UK Silvertown
[Asia Economy Reporter Onyu Lim] SK Engineering & Construction announced on the 23rd that its Almaty Ring Road project in Kazakhstan was selected as the ‘European Transport Project of the Year’ by the global financial magazine PFI. With this, SK Engineering & Construction’s overseas infrastructure PPP projects have won PFI’s global finance awards for three consecutive years. In 2018, the Turkey ?anakkale Bridge and Road project, which involved constructing the world’s longest suspension bridge, received the honor, and in 2019, the Silver Town Tunnel project in the UK, the first Western European PPP project involving a Korean company, was awarded.
The Almaty Ring Road project is Kazakhstan’s first infrastructure PPP project, aimed at alleviating traffic congestion in Almaty, the economic capital of Kazakhstan. It involves constructing a 66 km-long 4 to 6-lane dual carriageway ring road, 21 bridges, and 8 interchanges. The total project period is 20 years, including a 50-month construction period and a 15-year and 10-month operation period. The project is carried out under a BOT (Build-Operate-Transfer) scheme, where the completed road is operated and then transferred to the government. It adopts an AP (Availability Payment) method, where the government guarantees fixed revenue during the operation period, eliminating the risk of revenue fluctuations due to traffic volume prediction errors.
SK Engineering & Construction formed a consortium with Korea Expressway Corporation, Turkey’s Alarko, and Mak Yol, and signed an implementation agreement with Kazakhstan’s Ministry of Industry and Infrastructure Development in February 2018 for the construction and operation of the Almaty Ring Road. In February last year, a financing agreement was signed with a consortium of multilateral development banks, including the European Bank for Reconstruction and Development, the Islamic Development Bank, and the Eurasian Development Bank, to raise $580 million of the total $750 million project cost through project financing. In August, overcoming difficulties caused by the prolonged COVID-19 pandemic, the project successfully completed financial close and commenced full-scale construction. The current progress rate is about 15%, with completion scheduled for September 2024.
Including this project, SK Engineering & Construction is currently engaged in multiple overseas infrastructure PPP projects. In Turkey, the Eurasia Undersea Tunnel was completed in December 2016 and is currently in operation. The ?anakkale Bridge and Road project, jointly won with DL E&C, is accelerating construction with a target opening in early 2022. The Silver Town Tunnel, passing under the River Thames in London, UK, is also under construction with a planned opening in 2025.
Jaehyun Ahn, President of SK Engineering & Construction, said, “It is an honor that SK Engineering & Construction’s overseas infrastructure PPP projects have won global finance awards for three consecutive years. As a global developer, we plan to explore business opportunities not only in Europe but also in various regions around the world.”
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