Samsung Eng. enters Russia with €1 bn petchem plant deal

South Korea’s Samsung Engineering made inroads into Russia’s plant engineering and construction market with a 1 billion euro ($1.1 billion) deal for a petrochemical project in the energy-rich country.

Samsung said on Wednesday it signed an engineering and procurement contract with China National Chemical Engineering & Construction Corporation Seven, Ltd. (CC7) for the Baltic Ethane Cracker Project. The contract was Samsung’s first deal in Russia.

Samsung is scheduled to complete the work by Oct. 15, 2024, according to its filing to South Korea’s financial regulator.

CC7 won an engineering, procurement and construction (EPC) deal from Baltic Chemical Complex LLC. for the project to build two ethane crackers in Ust-Luga with a combined annual ethylene capacity of 2.8 million tons.

The human settlement in the Gulf of Finland, about 110 kilometers southwest of St. Petersburg, is one of Russia’s major ports that export oil and petroleum products such as naphtha. Ust-Luga is set to become home to Russia’s largest gas-petrochemical complex with major industrial parks under construction there.

Samsung aims to expand its presence in Russia with the deal.

“We will maximize efficiency and productivity, utilizing experience and know-how from projects in neighboring countries such as Uzbekistan and Azerbaijan,” a company source said.

Write to Jung-hwan Hwang at jung@hankyung.com

Jongwoo Cheon edited this article.