LG Electronics and Local Heating Corporation to Promote 'K-Smart City' Cooling Project in Kuwait New Town

Aerial view of Abdullah New Town, Kuwait.

[Asia Economy Reporter Jeong Hyunjin] LG Electronics is advancing a district cooling project in the new city of Kuwait in collaboration with the Korea District Heating Corporation. As the first export project of a Korean-style smart city, LG Electronics, the number one domestic chiller (large-scale cooling system supplying cooling to large buildings) industry leader, will participate and leverage the know-how accumulated in the Middle Eastern market.

According to industry sources on the 6th, LG Electronics and the Korea District Heating Corporation signed a confidentiality agreement last month to promote the "Kuwait Abdullah New City District Cooling Project" and are currently in business consultations. Through this agreement, the Korea District Heating Corporation provides feasibility analysis data related to the project, and LG Electronics shares main equipment technical information while reviewing ways to secure the project's viability and economic feasibility. Based on this, the Korea District Heating Corporation plans to propose the district cooling project to the Kuwait Public Authority for Housing Welfare in the second half of this year.

The Kuwait Abdullah New City project is Kuwait's first smart city development project, created through cooperation between the governments of Korea and Kuwait, covering an area of 64.4㎢ (approximately 20 million pyeong) on the outskirts of the capital, Kuwait City. LH has been leading urban planning and design since 2017, and the Korea District Heating Corporation signed a business agreement with LH in 2018 for the district cooling project for the new city, forming a consortium centered on domestic companies. LG Electronics, participating in the consortium as the number one domestic chiller industry leader, will be responsible for manufacturing and supplying equipment for the new city's cooling project.

LG Electronics officially entered the chiller business in 2011 through the acquisition of LS Mtron's air conditioning division and is reported to hold about a 40% market share domestically. It is also expanding its presence in the global chiller market. In April 2016, LG Electronics became the first domestic company to win a large-scale cooling project supplying turbo chillers for a government project in Saudi Arabia. In May 2017, it designed the air conditioning system for a thermal power plant building in Vietnam, and in June 2019, it supplied a large-scale cooling system worth 10 million dollars to a nuclear power plant in India.

LH has announced plans to begin construction of the Abdullah New City project next year. However, due to the impact of COVID-19, there is a possibility of delays in project progress in Kuwait, and the situation is being closely monitored.