GS Bolsters Investment in Energy Business
By Yoon Ja-young
Staff Reporter
GS EPS, a power production arm of the GS Group, completed the building its second generating plant, Wednesday. The completion adds to the group's bolstered investment into the energy businesses.
The company held a ceremony to celebrate completion of the power plant in Dangjin, South Chungcheong Province, inviting around 200 guests from the business and political sectors. It took two years and three months to complete.
The power plant No. 2 is a liquefied natural gas (LNG) Combined Cycle Power Plant, which generates power in a gas turbine generator by burning LNG, and regenerates additional power in a steam turbine by recycling the heat of gas emissions. It thus has better efficiency than older power generators using coal. The system is also deemed eco-friendly as it emits only a small amount of pollutants.
The facility, which has 550,000 kilowatts capacity, pulled up the capacity of GS EPS to 1.1 million kilowatts, equivalent to the electric power consumed by 1 million people.
GS Group has notably increased investment in the energy businesses recently. It invested 320 billion won in building the second power plant.
GS EPS said it would start building power plants No. 3 and No. 4 earlier than originally planned. Each of the generators costs around 450 billion. The two projects are expected to be a boost to the regional economy, as they will create some 330,000 jobs a year. The renewable energy business is another sector the company is eyeing.
GS Caltex, the country's second-largest refiner, announced in May that it would invest 2.9 trillion won in its third upgrade unit to be built by 2010. It is the biggest project ever in the petroleum-chemical business. The heavy oil-upgrading unit (HOU), which turns heavy oil into more expensive jet fuel and gas oil, will be capable of producing 113,000 barrels a day. The facility is expected to add 900 billion won to yearly profits of GS Caltex.
The refiner plans to invest over 5 trillion won by 2011, including the HOU project.
The mega investment projects in the energy sector reflect the group chairman Huh Chang-soo's decision that timely investment is crucial amid the rapidly changing market. He told group executives in January to not be afraid of making investments and preparing new products and services by grasping the changes in the market. The group plans 2.5 trillion won in investment in the energy, retail and construction businesses this year, up 10 percent compared with 2007.
Amid global oil prices hikes, the energy industry has risen as one of the most promising business sectors. It is natural for the energy giant GS to increase investment, but a huge number of small companies are also paying attention to the sector. Among 134 listed companies that added new business objectives to their agenda, over 70 percent are looking toward renewable energy or resource development.