South Korea's electricity giant KEPCO and major automaker Hyundai are set to implement joint ventures in the fields of electricity generation, transmission and distribution in Iran.
In a meeting with Hamed-Ali Mobaraki, director of Chabahar Free Trade and Industrial Zone Organization, in Chabahar on Tuesday, KEPCO officials said they are willing to build a 1,000-megawatt power plant in the port city based on a build-operate-transfer, or BOT contract, IRNA reported.
Mobaraki said international firms have expressed willingness to invest in Iranian markets, especially in the port of Chabahar, after Tehran and the six world powers reached a historic deal on July 14 in Vienna that would limit the Persian Gulf country’s nuclear program in return for removing sanctions on its energy and financial industries.
The government plans to turn Chabahar into the country's third biggest hub for auto and petrochemical production.
Korea Electric Power Corporation, or KEPCO, is the largest electric company in South Korea, responsible for the generation, transmission and distribution of electricity and the development of power projects, including those related to nuclear, wind power and coal.
The 51% state-owned company, which is headquartered in South Korea's capital Seoul, has an installed capacity of around 67,000 MW and supplies 93% of Korea's electricity generation from 503 generation units, including nuclear, oil, coal, liquefied natural gas, hydro, wind and solar sources.
Ties With Hyundai
In a meeting between Iranian officials and representatives from Hyundai Group on Tuesday, the two sides reached a preliminary agreement to establish a joint venture for investment in energy projects in Iran and its neighboring countries.
"Hyundai can become a reliable partner for carrying out energy projects through a joint venture with Iranian firms," Alireza Daemi, deputy energy minister for planning and economic affairs, said after a meeting with Hyundai officials in Tehran.
"Hyundai has pledged to finance and contribute to the construction of power plants with the Islamic Republic."
The two sides also discussed grounds for cooperation between major domestic gas turbine manufacturers and Hyundai. This comes as the Energy Ministry is taking measures to boost the efficiency of gas-fueled power generation units.
Hyundai is widely known as a leading international carmaker. It operates the world's largest integrated automobile manufacturing facility, which is capable of producing 1.6 million units annually.
However, it has expanded its operations in the power sector, including power plant construction, as well as building vessels.
Daemi also quoted Hyundai officials as saying that the South Korean giant "faces no limits" for investment in Iran's electricity industry and it can finance energy projects via foreign banks.
Reliable Partner
Seoul has convinced Tehran about its intention of being a reliable trade partner. It has always remained active in Iran, during the Iran-Iraq War, and in recent years, after the US and its allies imposed tough sanctions against the country, while many automakers left the country.
Iran is currently South Korea’s third biggest export partner in the Middle East with over 20 companies operating in the country.
Last month, the Korean Minister of Land, Infrastructure and Transport Yoo Il-ho arrived in Tehran at the head of a 30-member business delegation.
South Korea also wants to play a crucial role in Iran’s steel industry, the largest in the Middle East, as shown by extensive talks between Korean steelmaker POSCO and several Iranian firms on possible cooperation.
