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Daelim

Daelim

Industry: 
Construction
Value of USG Contracts: 
174
Symbol: 
SEO:000210
States: 
FL
Country: 
South Korea
Contact Information: 
Sources: 

"Managing director of Isfahan Oil Refinery said the facility has signed a memorandum of understanding (MoU) with South Korea's Daelim Company for improving production procedures and optimizing the facility. Lotfali Chavoshi said on Monday that the process improvement and optimization plan of the refinery will bring the facility to its golden days. He said the MoU is an Engineering, Procurement and Construction (EPC) contract with Daelim's financing. The CEO added that the plan will be carried out in a 4-year period with an investment of $2b. In the project, Daelim will cooperate with Iranian contractors and National Iranian Oil Engineering and Construction Company will serve as the operator, he added." (Fars News, "Isfahan refinery, S. Korea's Daelim Ink MoU," 7/19/2016)

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"International economic sanctions on Iran were lifted in January, and Korean companies have wasted no time getting back into the market. According to government sources, contractor Daelim Industrial is expected to sign a $4.9 billion contract to build a railway to connect Al Wajh and Isfahan, as well as a $2 billion contract to build the Bakhtiari Dam hydroelectric power plant, as early as next week. They will be the first major contracts won by a Korean company since GS Engineering & Construction (E&C) won a gas field development project in South Pars in October 2009 - which was before economic sanctions levied by the international community in 2010.  Daelim's advantage was its strong connection with Iran. The contractor maintained four employees in Iran even after the economic sanctions went into effect. That kept its networks going - and earned points with Iranian government officials and businesspeople." (Korea JoongAng Daily, “Korean firms bank on past loyalty to Iran,” 4/29/2016)

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Company website lists operations in Iran as part of global network. (Company Website)

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“Korean construction firms are paying attention to Iran, the fourth largest client in the global construction market. Responding to the lifting of sanctions against Iran, they are taking swift actions, such as strengthening market survey and preparing to enter the market…Korean construction firms are taking actions behind the curtains while watching international political situations. Hyundai E&C and Daelim, two major constructors in Korea, have operated a local office in Tehran where Korean and Iranian employees work together in order to re-enter the Iranian market at some point. An official from a large construction firm said, ‘Since gaining trust from a client is very important in the Middle East, Korean construction firms have maintained relationships (with Iranian clients) even after sanctions.’ Kwon Myeong-gwang, an ICAK manager in charge of Iran and Kuwait markets, said, ‘Iran is a big market, and projects that couldn’t be embarked on due to economic sanctions may come to the market all at once,’ adding, ‘Construction of oil and gas facilities is promising.’” (The Dong-A Ilbo, “Will thawing sanctions against Iran boost construction business?” 2/2/14)

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"Daelim Industrial Co had a nearly $1.5 million U.S. government contract to build family housing at a military base in South Korea at some point between mid-2011 and late 2012, the General Accountability Office said in a report on Monday. The GAO is the investigative arm of Congress... Such companies should also be denied contracts with the U.S. government, it says. The GAO did not say how much Daelim's investments in Iranian energy were worth... Daelim was one of at least seven companies from China, India, South Korea  and South Africa that continued to have investments in Iran in 2012, the GAO said in December, in a report required by a U.S. sanctions law. A Daelim spokesman in Seoul said the company was simply completing a construction project in Iran that predated the U.S. sanctions. He added that the building contract did not constitute an investment in Iran's energy sector, as stipulated in the U.S. sanctions law, and that Daelim had not signed any new contracts in the Islamic Republic since 2010. Daelim, which the GAO said had helped to develop Iran's South Pars gas fields and a liquefied natural gas project in Tombak, was the only one of the companies found also to hold a contract with the U.S. government, the GAO said on Monday." (Reuters, "South Korea firm had U.S. contract while investing in Iran gas: GAO," 2/26/2013)

 

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"Daelim, a South Korean engineering and construction giant, has been active in Iran since 1975, building refineries, as well as natural gas and power plants. In 2007, it signed a refinery deal worth $700 million to the company. And in 2009, Daelim struck a deal worth $600 million to the company to help Iran develop a phase of the South Pars gas fields, a spokesperson confirmed. While doing business in Iran, it has won contracts from the United States, including a $111 million contract awarded last year to build family housing towers for the Army. The Iran Sanctions Act prohibits investments above $20 million in a given year in Iran's energy sector. Investments are defined as deals in which a company purchases shares or enters into a contract that provides for royalty payments. But investments also are defined as deals in which a company enters into a contract that includes responsibility for the development of petroleum resources, which is what landed Daelim on a list of potential Iran Sanctions Act violators put together by the Congressional Research Service. In a statement, the company said that it had disputed the listing and did believe its construction work in Iran met the law's criteria. 'Based on our review, we never did anything that violated the law and we never did any investment in Iran,' the company said."  The company has received $174 million from the US government for their business in Iran during 2000-2009.  Their investments are currently active in Iran, and the company has been listed by the New York Times as a possible violator of the Iran Sanctions Act. (The New York Times, "Profiting from Iran, and the US," 3/6/2010)

Response: 

No response at this time.