Daewoo E&C Takes on Gadeokdo New Airport Site Project: "We Will Carry Out This National Project with a Strong Sense of Responsibility"

Bid Fails Again... Negotiated Contract with Public Procurement Service

On March 5, Daewoo Engineering & Construction announced that it has decided to enter into a negotiated contract for the site preparation work of the Gadeokdo New Airport. Previously, a competitive bidding process through the Public Procurement Service failed to result in a successful bid, so the process has now transitioned to a negotiated contract, and the company will begin the administrative procedures in earnest. The Gadeokdo New Airport project is a mega-project, with the site preparation work alone amounting to 10.7 trillion won, and the total project cost exceeding 16 trillion won when including surrounding infrastructure.

This project was commissioned as a design-build turnkey contract. For technical bids subject to the National Contract Act, the negotiated contract process involves first selecting a counterpart, confirming their intention to participate, and then changing the contract method accordingly. Afterward, the process includes basic and detailed design submissions and evaluations, price negotiations, and contract signing. Daewoo Engineering & Construction plans to closely collaborate with the Public Procurement Service to expedite the subsequent procedures. In order to lay the groundwork for an early start, the company will establish a joint office with participating partners and strengthen pre-inspections across all areas of design, construction, quality, and safety, thereby commencing full-scale project preparations.

Perspective view of Gadeokdo New Airport. Provided by Busan City

Hyundai Engineering & Construction, which originally held the largest stake in the consortium and had been negotiating with the government, withdrew from the project after failing to narrow differences over issues such as the construction period. While it is not uncommon for consortium members to change during bidding or negotiations, it is rare for the lead company to withdraw midway. Daewoo Engineering & Construction originally held the second largest stake (18%) in the consortium after Hyundai Engineering & Construction (25.5%).

A company official stated, "As the counterpart in this negotiated contract, we will take on this national project with a strong sense of responsibility and move forward swiftly," adding, "We will leverage our accumulated experience and technical expertise in large-scale civil engineering and marine construction, prioritizing safety and quality above all, and prepare thoroughly."

Daewoo Engineering & Construction, which will be responsible for the project, announced its plan to address concerns about ground subsidence and ensure compliance with the construction schedule by analyzing the pros and cons of alternative construction methods and consulting with external experts to derive the optimal basic design. The basic design phase is expected to take approximately six months, in accordance with the bidding guidelines, before moving on to the detailed design stage. If all procedures proceed smoothly, construction of the priority section could begin by the end of this year. The company explained that it has accumulated experience in marine and reclamation works both domestically and internationally, as well as expertise in complex offshore and soft-ground construction and project management know-how.

Kim Yoonduk, Minister of Land, Infrastructure and Transport, is inspecting the site of the planned Gadeokdo New Airport in August last year. Provided by the Ministry of Land, Infrastructure and Transport

The site preparation work for the Gadeokdo New Airport is a project aimed at promoting balanced national development and establishing a gateway airport for the southeastern region, with a total budget of 10.7174 trillion won. When the government re-announced the bid last year, the original construction period was extended from 84 months to 106 months, reflecting proposals made by Hyundai Engineering & Construction during the negotiation process. The construction cost was also increased by 200 billion won. Nevertheless, Hyundai Engineering & Construction did not participate in the rebidding under these revised conditions.

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