LS Cable consortium wins $1.5 billion cable deal from the Netherlands

A three-party consortium including South Korea’s LS Cable & System Ltd. has won a 2 trillion won ($1.5 billion) deal to build high-voltage cables for a European grid project linking a wind farm in the North Sea with facilities in Germany and the Netherlands.

LS Cable and its two partners – Belgium’s Jan De Nul Group and multinational energy conglomerate Denys – clinched the deal with TenneT B.V., a state-run electricity transmission system operator in the Netherlands, the Korean company said on Monday.

The contract marks LS Cable’s single largest underwater and onshore cable production project in terms of value.

Under the deal, the consortium will supply 525 kV high-voltage direct current (HVDC) electric power transmission cables to TenneT starting in 2026.

An HVDC electric power transmission system, also called a power superhighway or an electrical superhighway, uses direct current (DC) for power transmission, unlike the more common alternating current (AC) transmission systems.

The 525 kV cable is the highest voltage among HDVC cables, which significantly reduces power loss, and is thus more suitable for long-distance electricity transmission projects.

Such cables can also easily change the direction of power transmission by applying voltage source converter (VSC) technology.

Only a few global cable makers, with LS Cable being the only one in Korea, can manufacture such cables.

Prior to the European grid connection project, TenneT demanded a one-year reliability test as a bidding requirement for participating cable makers. LS Cable said it successfully passed the test last October.

TenneT has also awarded contracts to other successful bidders, including NKT and Nexans, for the grid connection project, which is worth 5.5 billion euros in total.

“We have been preparing for this deal, including building a factory dedicated to HDVC production. We also plan to make extra investments to meet rising demand from Europe and North America,” said an LS Cable official.

ASIA’S LARGEST HDVC FACTORY

Earlier this month, the Korean company said it had completed the construction of Asia’s largest HDVC factory in Donghae, a city in Gangwon Province, east of Seoul.

The 172-meter tower, which is as high as a 63-story building, will allow the company to manufacture lengthy cables in a single container to improve insulation quality and minimize the loss of power in transmission.

Most cable makers are producing tens of kilometers-long cables by connecting shorter ones (about 2 km long) to make it easier to replace a faulty section. Otherwise, the lengthy cables must be scrapped completely if any section has a problem with power transfer.

LS Cable is the only company in Korea that can make long-distance underwater cables longer than 100 km.

The company is known globally for its long-distance and high-pressure cables, giving it a key competitive edge in the growing underwater high-voltage cable market.

Demand for such cables is rising at a fast rate as offshore wind farms are gaining momentum in the production of renewable energy to combat environmental pollution.

Write to Jeong-Soo Hwang at hjs@hankyung.com

In-Soo Nam edited this article.