LG-Hitachi Water Solutions plans to develop a facility in Yeosu where it can reuse the city’s sewage water as a clean source for the city’s industrial complex.

The company said Friday that it has signed a memorandum of understanding with the Yeosu government to invest in the infrastructure, which will be able to treat and recycle 35,000 tons of sewage and cost 45 billion won ($40 million).

It did not give any development timeline for the project. However, the reusable water will be supplied to Yeosu’s industrial zone, where it houses Korean chemical and petrochemical conglomerates such as LG Chem, Honam Petrochemical and GS Caltex.

LG Group, Korea’s fourth largest conglomerate, has put its flagship subsidiary LG Electronics at the forefront to boost water business as its new growth engine.

LG Electronics acquired Daewoo Entec, a water treatment operator last year, and launched the joint venture with Hitachi Plant Technologies early this year to tap into the lucrative water treatment market globally.

LG-Hitachi Water Solutions said it first planned to expand its presence in the Korean market, then gradually expand overseas where opportunities for water treatment infrastructure could exceed 50 trillion won.

Its planned Yeosu recycling facility will be able to cut carbon emissions of up to 587 tons annually, further spurring the country’s green growth, while protecting the sea by reusing sewage.

“With this MOU agreement, LG-Hitachi Water Solutions will speed up its expansion in the procurement market,” said CEO Lee Young-ha.

LG Electronics will provide manufacturing and technology know-how, while its partner Hitachi has research and development resources in water treatment. The joint venture engages in engineering, procurement and construction, and operation and maintenance, according to a press release.

By Park Hyong-ki (hkp@heraldcorp.com)