Doosan Heavy Industries & Construction (DHIC) has recently establishes itself as the core of the South Korea’s strategy to become the fifth nation to possess an independent gas turbine model. Reportedly, after the December 2019 deal, the company has signed dual contracts with Korea Western Power Co. (KOWEPO) jointly worth $300 million.
The contract was centered around the construction of the 500-MW Gimpo CHP plant situated in the Gyeonggi Province. The CHP plant, which is set to be fully operational by the first half of 2023, will use liquefied natural gas (LNG) to power nearby regions and generate district heat.
It would also demonstrate South Korea’s first homegrown large gas turbine and would act as a founding step in the country’s strategy to build a locally developed gas turbine industry. In case of being a success, the nation would join countries like Germany, the U.S., Italy, and Japan that have an independent gas turbine model.
For the record, these regions have the world’s biggest gas turbine OEMs such as Siemens Energy, General Electric, Ansaldo Energia, and Mitsubishi Hitachi Power Systems (MHPS). However, things haven’t been smooth for DHIC lately. The company which was already reporting losses since 2014 experienced a steep dip during the COVID-19 pandemic.
In April, the firm’s prospects were so low that the state-run creditors like the Korea Development Bank and the Export-Import Bank of Korea had to intervene to stave off the company’s “liquidity crisis” by handing out a 1 trillion won ($817 million) credit as part of a relief package.
The federal government realizes the significance of DHIC and the consequences if the company fails to stay operational. Roughly a quarter of the electricity on S. Korea’s grid comes from DHIC and no other local company is qualified enough to step into the shoes of DHIC.