Indonesia, rich in minerals and with a human resource pool of 280 million people. Hyundai Engineering and Hyundai Motor Company have already established a foothold here through localization in a place recognized for its great growth potential. The government proposed a path of growth together with Indonesia, and both companies agreed. They plan to expand their influence by supporting Indonesia's development as a foothold to engage with the ASEAN (Association of Southeast Asian Nations) population, which will reach 700 million people in the future.
Hyundai Engineering Captures Both Refinery Plant Technology and Safety Construction
The site view of the 'Balikpapan Refinery Project' being carried out by Hyundai Engineering in Indonesia / Photo by Hyundai Engineering
Hyundai Engineering has established its base in Balikpapan, East Kalimantan, a gateway to Indonesia's planned new capital, 'Nusantara.' This is due to the massive Balikpapan refinery project worth over 4 trillion won.
Although Indonesia is an oil-producing country, its refining facilities are inadequate, utilizing only 60% of crude oil. The country is currently pursuing a policy project for refining self-sufficiency. Among these, Hyundai Engineering secured the largest project worth 5.8 trillion won, holding a 70% share. It has been over three years since the contract was announced. This order earned Hyundai Engineering titles such as 'the largest Korea-Indonesia plant sector cooperation' and 'the first entry into an Indonesian state-owned oil company's ordered project.'
On the 18th, the One Team Korea bidding support group, led by Won Hee-ryong, Minister of Land, Infrastructure and Transport, visited the site. The approximately 3 million square meter site, equivalent to 400 football fields, was densely packed with ▲electricity, water, and steam production facilities ▲existing plants under renovation ▲crude oil refining facilities (including upgrading) ▲final product storage tanks.
This project mainly aims to upgrade existing facilities and install new desulfurization equipment. However, according to Hyundai Engineering officials, at the Indonesian government's request, three tanks were first installed and are currently operating on the right side of the site entrance. Large-scale seawater desalination facilities, mainly used in water-scarce countries, were also in place. Seawater desalination refers to the process of drawing seawater and removing salt and various dissolved substances to obtain high-purity water.
A distillation tower as tall as a 28-story apartment building was also visible. An official said, "Crude oil is refined like pressing sesame oil to extract liquefied petroleum gas (LPG), gasoline, naphtha, kerosene, diesel, bunker C oil, etc.," adding, "These can be used as fuel for both household and industrial purposes."
The site view of the 'Balikpapan Refinery Project' being carried out by Hyundai Engineering in Indonesia / Photo by Hyundai Engineering
Hyundai Engineering has achieved over 50% construction progress as of the end of February for this project, which spans design, procurement, and construction. Commissioning has also begun, with an overall progress rate of 68.93%, and completion is scheduled for September 2025. An official explained, "After completion, the daily production of refined crude oil products will increase from the current 260,000 barrels to 360,000 barrels," adding, "This is about half of the 670,000 barrels produced daily at S-Oil's Onsan plant in Korea."
Work was in full swing despite the equatorial heat. Especially noticeable were banners with slogans emphasizing safety, such as 'No Safety, No Tomorrow.' Hyundai Engineering reported achieving 80 million man-hours without accidents over 1,480 days. A total of 19,447 people are working here, including 528 Koreans (291 from the company and 237 from partner companies) and 18,919 locals (2,049 from the company and 16,870 from partner companies).
Minister Won encouraged the site staff, saying, "Since our country is small and lacks resources, we must go out into the world to win orders. It would be good to enter industrial complexes as a package." He added, "Hyundai Engineering is carrying out five projects in Indonesia, and the government and public institutions will fully support and the public will cheer." He also delivered 400 nail clippers, which employees voted as the most needed item.
Hyundai Motor’s Strength Lies in High-Touch as Much as High-Tech
Expansion view within the Hyundai Motor factory complex located in the Bekasi area of Indonesia / Photo by Noh Kyung-jo
The One Team Korea also visited Hyundai Motor's plant complex in Bekasi, about 40 km from Jakarta. This is Hyundai Motor's first complete vehicle production base in ASEAN countries, with a site area of 777,000 square meters. Here, the Ioniq 5, the first locally produced electric vehicle in Indonesia, was born last year. A nearby Honda plant was visible, which reportedly halted operations for a while during the COVID-19 pandemic.
Hyundai Motor has built an eco-friendly image in Indonesia. Utilizing Indonesia's natural environment, which is advantageous for geothermal power due to many volcanoes, it produces electricity from renewable energy. It was also recognized for its corporate social responsibility (CSR) efforts. When daily new COVID-19 cases reached 50,000 to 60,000, Hyundai Motor responded to the Indonesian government's request to produce medical oxygen. A Hyundai Motor official said, "Rather than just selling cars, we wanted to show corporate value and listen to what locals want."
Hyundai Motor is expected to serve as a hub for expanding into the ASEAN market. The head of the Indonesian corporation explained, "We have prepared a mid- to long-term vision until 2032," adding, "We plan to increase annual production from the current 150,000 units to 250,000 units in 10 years." The plan is to increase localization rates and enter Vietnam, Malaysia, and other countries within the economic bloc tariff-free. They are determined not to miss the opportunity as electric vehicles are still in the early stages in ASEAN countries.
Minister Won emphasized, "We should not be swayed by immediate transactional profits but look at the bigger picture," adding, "Indonesia values not only new cities but also manufacturing, future industries, and knowledge industries that go global. Hyundai Motor's role is connected to national strategy."
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