Tuesday, June 17th, 2014
SEOUL, KOREA - Hanwha Group is keenly watching how the situation in Iraq is developing. The current civil war-like disturbance began as radical Sunni-affiliated rebel forces attacked the Shiite-led Iraqi government and its major cities. Hanwha Group is currently undertaking projects worth more than 1 trillion won including the Bismayah New City project near Baghdad and petrochemical plants.
In addition, the group's subsidiary Hanwha Chemical is reviewing an idea of building a petrochemical plant in the south of the country in partnership with a local company. According to the plan, the chemical unit will invest US$4 billion to build an ethane gas cracking process with an annual capacity of 1 million tons and later expand it to produce other petrochemical products such as polyethylene. This is in response to North American petrochemical competitors are rushing to build capacities based on the cheap supply of shale gas.
To that end, Hanwha Chemical CEO Bahng Han-Hong exchanged a letter of intent with the Iraqi Deputy Minister of Industry and Minerals in December last year. A Hanwha Chemical official said, "As the deal has not been finalized, the current situation would not have any immediate negative impact on our business. We are just watching how things are unfolding now."
As for the Bismayah project, the official said, "The Iraqi government troops are guarding the construction site and the project is under way smoothly. The $8-billion residential city construction project is scheduled to be completed by 2020.
