[Alpha Biz= Paul Lee] Competition is intensifying for a major offshore gas development project in Libya, as South Korea’s two leading shipbuilders—HD Hyundai Heavy Industries and Hanwha Ocean—have entered the bidding race for a large-scale offshore engineering contract.
According to industry sources on Tuesday, both companies have been shortlisted as final candidates for the engineering, procurement, construction and installation (EPCI) contract for the E Block of Libya’s offshore gas development project known as “Structures A&E.” The project involves the construction of a massive fixed wellhead platform (WHP) weighing approximately 90,000 tons in offshore waters off the Libyan coast.
Of the project’s total estimated cost of $8 billion, the budget allocated to the E Block offshore platform is estimated at $3–4 billion, or roughly KRW 5 trillion. Securing the contract would significantly bolster order backlogs for the winning shipbuilder from early next year, while also revitalizing the high-value offshore plant segment, which has lagged behind commercial shipbuilding in recent years.
The Structures A&E project is being developed by Mellitah Oil & Gas, a joint venture between Libya’s National Oil Corporation and Italian energy major ENI. The initiative aims to develop two offshore gas fields to expand domestic gas supply and increase exports to Europe.
The E Block platform targeted by South Korean shipbuilders will be located approximately 130 kilometers off Libya’s northwestern coast and will include facilities for gas drilling and production, as well as separation, compression, and processing systems.
Although gas production was initially scheduled to begin this year, the E Block development has faced repeated delays. However, momentum has recently picked up. According to offshore industry publication Upstream, the project owner is finalizing its EPCI procurement strategy, with prequalification reviews for shortlisted bidders nearing completion.
In addition to HD Hyundai Heavy Industries and Hanwha Ocean, the shortlist reportedly includes CIMC Raffles, India’s infrastructure conglomerate Larsen & Toubro, and UAE state-owned engineering firm NMDC Energy.
If a South Korean shipbuilder secures the EPCI contract, the deal could mark a turning point for the country’s offshore plant sector, which has lagged behind the commercial shipbuilding segment despite strong global demand for new vessels.
Last year, HD Hyundai Heavy Industries recorded offshore plant orders of $133 million, far short of its initial annual target of $1.88 billion. Hanwha Ocean, meanwhile, has been restructuring its offshore and energy infrastructure businesses, including the integration of underperforming divisions, in an effort to regain competitiveness in high-value offshore projects.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
