180-day design phase under way as project enters execution stage
Government to discuss support for rising construction costs
Contingency measures planned even if legislation is delayed
The Daewoo Engineering & Construction consortium announced Tuesday that it has formally launched detailed design work for the site development of Gadeokdo New Airport. The Ministry of Land, Infrastructure and Transport officially requested the start of the detailed design phase and agreed to discuss support measures to reflect rising construction costs, moving the project into an execution stage ahead of the main construction works.
The detailed design phase, which began Monday, is scheduled to run for 180 days. The government and the Daewoo Engineering & Construction consortium plan to consult closely throughout the design period to ensure all subsequent procedures proceed without delay toward the 2035 opening target.
The Ministry of Land, Infrastructure and Transport sent an official letter to the chief executive of Daewoo Engineering & Construction on Nov. 3, requesting the start of detailed design work for the Gadeokdo New Airport site development project. The ministry also said it shared the view that the sharp rise in construction costs stemming from the Middle East war constitutes a force majeure event and that the estimated cost increase exceeds what the contractor can reasonably absorb.
The government said it would work with fiscal authorities to swiftly introduce an amendment to the Gadeokdo New Airport Act and that related ministries would cooperate to secure its passage through the National Assembly. Regarding legislative uncertainty raised by some members of the contractor consortium, the Ministry of Land, Infrastructure and Transport said it plans to devise measures at the government level to reflect inflation even if the Assembly's review is delayed or the bill is withdrawn.
The government also said it would actively take necessary steps — including discussions on covering design costs — to ensure that contractors proceeding with detailed design work on the basis of the government's policy commitments do not suffer any disadvantage.
The Daewoo Engineering & Construction consortium said the launch of detailed design work "reflects the shared understanding and determination between the government and the consortium to keep the overall project schedule — including the 2035 opening — on track, separate from National Assembly procedures such as the legislative amendment."
A Daewoo Engineering & Construction official said the start of detailed design work by the consortium "is a positive signal that the Gadeokdo New Airport project, which will serve as the gateway airport for southern South Korea, has entered a full-scale execution phase," adding that "with the government's strong commitment to support and the contractor's expertise working in tandem, we expect the main construction to begin on schedule following the 180-day detailed design process."
Meanwhile, Daewoo Engineering & Construction posted sales of 1.84 trillion won ($1.36 billion) and operating profit of 183.2 billion won in the third quarter. Its cumulative operating profit for the first three quarters reached 671.1 billion won, up 131.3 percent year on year, with an operating profit margin of 11.5 percent — 6.9 percentage points higher than the same period last year.
lucky@heraldcorp.com
