Tehran-Seoul in $1.4bn pact

South Korea's GS Engineering & Construction (GS E&C) confirmed it has won a 1.6 trillion won (Dh5.03 billion, $1.37bn) project to sweeten gas from the South Pars field in Iran, increasing its presence in the gas-rich country.

GS E&C said it and a consortium including Iranian International General Contractor had agreed to complete phases six, seven and eight of South Pars gas project with Pars Oil and Gas, a subsidiary of Iranian national oil company, by May 2013.

"GS E&C secured a stable base in Iran, the world's second-largest natural gas reserves, by winning the gas desulfurisation project after it had successfully completed the nine-10 phases of South Pars project," Moo-ik Chang, Vice- President of GS E&C said in a statement.

The South Pars reservoir is shared by Iran and Qatar. The Iranian part is divided into 24 phases. The 1.6-trillion won the South Korean firm will receive is equivalent to 77 per cent of the total construction, the statement said.

Iranian media reported on Monday that an Iranian state oil and gas firm had signed a contract with a South Korean company referred to as GS to sweeten gas from the South Pars field in the Gulf, but gave no further details.

Iran has almost 16 per cent of the world's total gas reserves, but currently has no major net exports partly because US and UN sanctions have deterred investment by Western firms with expertise and technology.

Keep up with the latest business news from the region with the Emirates Business 24|7 daily newsletter. To subscribe to the newsletter, please click here.