October 28, 2020 Read More →

Samsung pledges to quit coal construction, but not before building Vung Ang 2 plant


Samsung C&T Corp. will finish two more coal projects before exiting the sector.

Construction of the two ventures, the Gangneung facility in South Korea and the Vung Ang 2 project in Vietnam, are scheduled to be completed in 2023 and 2024, respectively. The pledge to exit the coal industry is “unprecedented” for a non-financial firm in South Korea, the company said in a statement.

The de-facto holding company of the Samsung empire has faced growing criticism over its involvement in coal amid mounting global pressure to halt use of the dirtiest fossil fuel. Activist climate investors expressed concern Samsung C&T remained committed to the two projects.

Global investors are increasingly voicing concerns over the risks associated with South Korea’s overseas coal financing as the state-owned Korea Electric Power Corp., known as Kepco, continues to approve plans to invest in new projects. BlackRock Inc., the world’s biggest asset manager with a stake in the utility, urged the company to provide clear strategic rationale for its investment in new plants in Vietnam and Indonesia.

Kepco’s board of directors approved a $200 million investment in the Vung Ang 2 project earlier this month. A joint venture between Samsung C&T and Doosan Heavy Industries & Construction Co. will be in charge of engineering, procurement and construction for the project, a Kepco spokesman said Oct. 6.

Samsung C&T said its trading arm will also gradually exit from all coal-related businesses once its existing contracts terminate, while seeking to expand its business into LNG and renewables. The company will completely withdraw from the Gangneung project after selling all of its 29% stake, which it can do it three years after commercial operations begin in end-2023.

[Heesu Lee]

More: Samsung construction arm to ditch coal after 2 more projects

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