Hyundai Heavy Gets $2.06B Order for Gorgon LNG Project

SEOUL (Dow Jones), Oct. 21, 2009

South Korea's top shipbuilder Hyundai Heavy Industries Co. said Wednesday it has signed a $2.06 billion deal to build core parts of a liquefied natural gas plant for Australia's Gorgon LNG project.

Under the deal, Hyundai Heavy will build the LNG plant's core facilities in Ulsan, South Korea, and deliver them to Barrow Island in Australia by October 2013, the company said in a statement.

"The order is the single biggest contract we have ever signed in the company's history," Ulsan-based company spokeswoman Miri Kim said by phone.

At 0440 GMT, shares in Hyundai Heavy were up 0.5% at KRW192,000, outperforming other domestic shipbuilders, which were all down in line with the benchmark Kospi's 0.2% loss. Hyundai Heavy already climbed 6.8% in the past two sessions on expectations it would get the order.

The LNG offshore plant plans to produce 15 million metric tons a year of liquefied natural gas starting 2014, the statement said.

Chevron Corp. owns a 50% stake in the $37 billion Gorgon LNG project, followed by Exxon Mobil Corp. with 25% and Royal Dutch Shell PLC with 25%, the spokeswoman said.

Hyundai Heavy has already chalked up $5 billion of orders so far this year, and the company expects to achieve this year's order target of $5.84 billion for the offshore plant business.  

Copyright (c) 2009 Dow Jones & Company, Inc.