DL E&C Wins 300 Billion KRW Contract for Modernization of Russian Oil Refinery Project

Site view of the modernization project of Gazpromneft's Moscow refinery in Russia, contracted by DL E&C

[Asia Economy Reporter Onyu Lim] DL E&C (formerly Daelim Industrial) has succeeded in securing its first overseas order since changing its company name.

DL E&C announced on the 12th that it signed a preliminary contract with Russian oil company Gazprom Neft for a Moscow refinery modernization project worth 327.1 billion KRW.

This project involves constructing a hydrocracking plant at a refinery located in the southeast of Moscow. DL E&C will independently handle design, procurement, and construction supervision. Since 2013, the refinery has been undergoing modernization in three phases, including the expansion of two distillation plants. This project corresponds to the final third phase. The new plant will be connected to the existing refinery facilities to receive a mixture of natural gas and petrochemicals, produce hydrogen, and use it to manufacture kerosene and diesel. With this preliminary contract, both parties will sign the main contract within 90 days, and completion is scheduled for the second half of 2024.

DL E&C expects orders to accelerate in Russia, a market it has diligently developed to diversify its overseas markets.

Previously, DL E&C entered Russia for the first time in 2014 as part of its strategy to pioneer new overseas markets. During this time, it successfully carried out basic and detailed design work for various gas and petrochemical plants, accumulating technical standards specialized for Russian plant projects, localization requirements, and know-how to meet the climatic and geographical particularities.

The company explained that by consecutively securing three projects ordered by Gazprom Neft, including this one, it has been recognized for its project execution capabilities by major clients in Russia.

Recently, DL E&C also won the basic design contract for a methanol plant ordered by EuroChem, a global fertilizer company based in Switzerland. The plant, located in Ust-Luga, 100 km southwest of Saint Petersburg, Russia, will be the world's largest methanol production facility with a daily capacity of 8,000 tons. DL E&C's strategy is to build strong trust with the client through successful basic design execution and extend the contract to EPC.

Yoo Jae-ho, head of DL E&C’s Plant Business Division, said, “Russia is a market with abundant oil reserves and high growth potential for plant projects. Based on our experience and technology in successfully executing projects under harsh conditions such as the Russian cold, we will establish a unique position.”

This content was produced with the assistance of AI translation services.