SK ecoplant expands in Europe via public partnerships

SK ecoplant's logo

By Yi Whan-woo

SK ecoplant is expanding its presence in the European construction market through public-private partnerships, collaborative projects between the government and private sector companies. Through these partnerships, large-scale public projects, such as roads, bridges or hospitals, can be financed, built and/or operated with private funding.

A consortium including SK ecoplant, the construction arm of SK Group, has been named the preferred bidder for a $2.2-billion road construction project in Norway, according to the company, Sunday.

This road construction project will make SK ecoplant the first Korean builder to carry out such project in Northern Europe. Other projects in which the company is involved are already underway in Turkey, the United Kingdom and Kazakhstan.

A bird's eye view shows the envisioned roads of the Rv 555 Sotra Connection project in Norway, worth $2.2 billion. Courtesy of SK ecoplant

Titled Rv 555 Sotra Connection, the $2.2 billion project is run by the Norwegian Public Roads Administration with the goal of improving traffic congestion in Bergen, one of Norway's major cities.

The consortium, Sotra Link, also includes Australia's Macquarie Capital and Italy's Webuild.

It will be responsible for the construction and management of a 10-kilometer-long, four-lane road as well as a 960-meter-long bridge that connects Bergen and Oygarden, which is to the west of Bergen.

SK ecoplant, which owns a 20-percent stake in the consortium, will be responsible for engineering, procurement and construction.

The Norwegian Public Roads Administration will pay 60 percent of the costs during the construction period and the remainder once construction is completed.

Sotra Link will operate the road system for 25 years after construction is scheduled to be completed in 2027.

The contract for the project is expected to be signed in the first half of next year.

“We're so glad to have advanced into the Northern European market through this project, following previous work in Western Europe,” SK ecoplant CEO Ahn Jae-hyun said.

He noted that the company has been working on the 1.2 billion-pound ($1.66 million) Silver Town Tunnel project in the U.K. The tunnel is expected to be completed in 2025.

“SK ecoplant will capitalize on our know-how and expertise to create various business opportunities through partnerships with global construction firms and financial services companies,” Ahn said.

He believes that the company's stable monetary supply was key reason for its selection as the preferred bidder for the project in Norway.

Ahn accordingly thanked three state-run companies ― the Export-Import Bank of Korea, the Korea Development Bank and the Korea Trade Insurance Corp. ― for making large amounts of loans possible.

In Turkey, SK ecoplant has a 28.3-percent stake in a $1.24-billion undersea tunnel project and a 25-percent share of the 3.1 billion-euro Canakkale Bridge project.

In Kazakhstan, it has been involved in the Almaty ring road investment project.