Park Jae-hyuk is a seasoned journalist who has provided comprehensive coverage of South Korea's corporate dynamics, economic policies, industry challenges and the global positioning of Korean companies. Based on the articles he has written since joining The Korea Times in 2016, his investigative approach has helped readers understand corporate governance, economic trends and business strategies shaping South Korea’s economy.
US nuclear projects emerge as income sources for Korean firms amid Iran crisis
Cooling towers are seen through a window at the Three Mile Island Nuclear Generating Station in Middletown, Pa., Oct. 16, 2024. Reuters-Yonhap
By Park Jae-hyuk
Construction companies set to cut reliance on Middle East
Expectations are growing that Korean companies will benefit from their participation in U.S. nuclear reactor construction, following the National Assembly’s passage of a special law allowing Korea’s $350 billion investment in American industries in exchange for tariff reductions.
Amid the heightened risks in the Middle East, construction firms have also expressed their intent to enter the U.S. nuclear reactor market, highlighting their plans for expansion in the energy sector.
“With Korea’s planned investment in the U.S. energy industry, Korea Hydro & Nuclear Power (KHNP) and reactor builders are expected to join the U.S. market, given their track record in constructing large-scale nuclear power plants,” Kiwoom Securities analyst Shin Dae-hyun said in a report Monday.
The government has not yet disclosed which sectors will be included in its first round of investments in the United States.
After meeting U.S. President Donald Trump at the White House on March 13, however, Prime Minister Kim Min-seok told reporters that the government is reviewing several ideas, including investment in nuclear power plant construction. Japan has included investments in small modular reactors (SMRs) in its second batch of U.S. investment projects.
Under these circumstances, investors showed strong optimism toward domestic construction firms last week, sending their stock prices sharply higher.
On Friday, Daewoo E&C’s share price surged 18.18 percent to 19,110 won ($13), marking the steepest weekly gain on the KOSPI. With a proven track record in global nuclear reactor projects, the company is taking part in a KHNP-led consortium for the Dukovany nuclear plant project in the Czech Republic.
That same day, DL E&C’s stock hit the daily price limit for the first time in 10 years. Its rapid rise was attributed to its partnership with X-energy, a U.S. SMR developer.
“By taking part in early-stage design, DL E&C is expected to secure entry into the U.S. SMR market,” Hanwha Investment & Securities analyst Song Yu-rim said.
Hyundai E&C, which has repositioned itself as an energy-focused company, has already expressed interest in participating in U.S. nuclear reactor construction.
Last month, the firm hosted a seminar on large-scale nuclear power plant technologies in Texas, following its contract last year with Fermi America to conduct front-end engineering design for four reactors under Project Matador, an 11-gigawatt private energy campus in the southern state.
During its upcoming general shareholders’ meeting Thursday, Hyundai E&C plans to vote on the appointment of Chung Eun-hyea, a professor at Seoul National University’s Department of Energy Resources Engineering, who is expected to advise the company on nuclear power plant construction projects.
“The Middle East is still an important market, but the risks of doing business there have increased,” a construction industry official said. “Major companies have been trying to reduce their reliance on the Middle East and are turning their eyes toward the U.S.”