Daewoo E&C collects W387.1b for project in Morocco

Daewoo Engineering and Construction said Tuesday it has received about 387.1 billion won ($323 million) of construction fees in the past two months from Morocco’s Safi Energy Company for building a coal power plant.

The Korean company kicked off construction of the Safi Independent Power Project this year, but there have been some concerns over the construction fees, as the payment was delayed.

The company said the payment is nearly completed, with the remaining small amount due early next year. 

It stressed that the fees categorized under “working on progress” does not refer to the amount that remains unclaimed by the construction company, as interpreted by some local media, but means the fees for construction that is currently underway or is scheduled.

“Depending on the size of the large-scale plant projects overseas, some of the fees, often over 100 billion won, can naturally be unclaimed temporarily. Not all of such amount should be categorized as a loss,” said a Daewoo E&C official said.

Unlike local construction projects for which payment is made monthly, payment for overseas projects are claimed under “milestone payment,” which involves making payments whenever each process of construction is completed, the company added. 

By Lee Hyun-jeong (rene@heraldcorp.com)