Samsung Engineering Co., one of South Korea's leading builders, has made its first foray into the U.S. liquefied natural gas (LNG) market by securing a US$5 million design contract for a plant in Texas, industry sources said Tuesday.
The basic front-end engineering design (FEED) contract, to be formally signed with Texas LNG within the month, is for the construction of a plant in Brownsville, near the Mexican border, that can process some 2 million tons of gas per year.
The contract also grants Samsung Engineering a share in the overall project.
"The contract is significant because companies from leading industrialized countries who enjoyed a head start had a stranglehold on the LNG plant market," a Samsung Engineering insider said. He said the contract runs through November 2015.
Besides Samsung Engineering, Britain's engineering consultancy and project management firm AMEC and Samsung Heavy Industries have a partnership for the LNG plant.
The South Korean company had won the so-called pre-FEED for the Brownsville plant in June, giving it an edge in the project as a whole.
Samsung Engineering said its design calls for extensive prefabrication of equipment and systems for the plant, reducing the building time and providing better protection of the environment.
Texas LNG plans to start engineering, procurement and construction (EPC) work in the latter part of 2016 so building can be completed in 2019. Total construction-related costs may reach $1 billion. (Yonhap)