Relocation of the LG International Head Office to the LG Building in Gwanghwamun, Jongno-gu

Relocation of the LG International Head Office to the LG Building in Gwanghwamun, Jongno-gu - Relocation from the LG Twin Tower in Yeouido to the LG Building in Gwanghwamun, Jongno-gu … all employees will be working in Gwangwhamun starting from Feb 11.- An exchange of the office space with the Energy Solution Company in LG Chem …following such an exchange, an expansion of the business synergy is expected to occur in each of the two companies. On Jan 31, LG International declared that it will relocate its head office from the LG Twin Tower in Yeouido to the LG Building in Gwanghwamun, Jongno-gu, Seoul. The length of the relocation project will roughly be about a week starting from Feb 2, and all of the employees of LG International will be working in the LG Building in Gwanghwamun from Feb 11. The relocation of the LG International head office was decided upon so that the company can exchange the office space with the Energy Solution Company in LG Chem that is located in the LG Building in Gwanghwamun. The two companies were of the same opinion, which was that it was time to enhance the speed of decision making and create synergy by uniting the main businesses of each company to one place. In fact, the office areas of the two businesses had previously been separated. A member of LG International stated that “Considering the business characteristic of LG International in that it conducts almost all its business in the overseas market along with the scale of the organization and human resources, the relocation of the head office is an extremely practical decision. Besides, this relocation will also enable easier communication with PANTOS, the affiliated distribution company which is located in the LG Building in Gwanghwamun.” Meanwhile, the Energy Solution Company of LG Chem will relocate its office space to the LG Twin Tower in Yeouido where the LG Chem head office is located, as the continuous expansion of its business requires a considerable amount of discussions regarding investments and business strategy at a corporate level.

LG International Has Nominated YOON CHUN SUNG Executive Vice President as CEO

LG International Has Nominated YOON CHUN SUNG Executive Vice President as CEO YOON CHUN SUNG Executive Vice President On Nov. 27, LG International held a board meeting to nominate YOON CHUN SUNG Executive Vice President as CEO and at the same time, carried out the regular appointment of executives by announcing the new appointment of three new Vice Presidents and the promotion of one executive. YOON CHUN SUNG Executive Vice President graduated from Yonsei University as an undergraduate and Yonsei University Graduate School Department of Geology. He joined LG International in 1989 as a new employee, and since then he has been in charge of the head of the Coal Business Division 1 (Vice President), the head of Indonesia region representative (Senior Vice President), and the head of the Resources Business Group (Executive Vice President). LG International has great expectations for YOON CHUN SUNG Executive Vice President to contribute to the construction of a solid resource and infra oriented business structure along with the stable profit creation based on his considerable expertise in the resources business and his successful investment business experiences. In addition, as part of the human resources affairs meeting, LG International newly appointed PARK DONG SOO the head of the Indonesia Palm Business Unit, KIM JUN HYOUNG the head of the Muscat Office, and MOON HYUN JIN the head of the Human Resources Management Team as Vice Presidents, in addition to transferring MIN BYEONG IL Vice President of LG Electronics as CFO in LG International. <New Appointment of Vice President> PARK DONG SOO Vice President KIM JUN HYOUNG Vice President MOON HYUN JIN Vice President <Executive Transfer> MIN BYEONG IL Vice President A spokesperson from LG International mentioned “This time, our human resources affairs intended to appoint people who have made the most appropriate accomplishments in line with the future preparation of LGI based on their leadership and expertise.” The staff member also had this to say, “We will strive to construct a stable and sustainable business structure and reinforce our business competitiveness.” Furthermore, SONG CHI HO President who for the past 35 years has worked tirelessly for the company, and been an excellent leader of LG International will retire(at the regular age limit) from the company and take up the position of an adviser in the future. LG International Executive Appointment Lists 2019 ■ CEO Nomination Executive Vice PresidentYOON CHUN SUNGCEO ■ New Appointment of Vice President : 3 persons Vice PresidentPARK DONG SOOHead of the Indonesia Palm Business UnitVice PresidentKIM JUN HYOUNGHead of the Power & Infra Project DivisionVice PresidentMOON HYUN JINHead of the Human Resources Division ■ Executive Transfer : 1 person Vice PresidentMIN BYEONG ILCFO

LG International Hosted In-company ‘Making Flower Boxes’ Event, Commemorating Parent’s Day

“Our Appreciation for Parents” LG International Hosted In-company ‘Making Flower Boxes’ Event, Commemorating Parent’s Day LG International employees participated in making flower boxes with carnations and miniature roses as Parent’s Day commemoration. On May 3rd and 4th, LG International hosted the in-company event ‘making flower boxes for the Parent’s Day’ so that the employees can express gratitude to their parents. About 160 employees were present at this event to make flower boxes and write letters to their parents. [Reference] Introducing the organizational culture of LG International LG International’s motto for organizational culture is ‘A Happy Home Leads to Better Work Performance (meaning the company and its members grow together by smart working based on being in a happy family)’; through the activities reflecting such motto, LG International tries to build the organizational culture where employees can focus on works based on the well-shaped work and life balance. Recently, it introduced new direction of organizational culture activity focusing on ‘Leaps and Bounds Through Work’ which means ‘making achievements through work and growing exceptionally,’ so that the employees can feel pleasure and self-esteem of their work.

LG International Conducts ‘Training to Overseas Investment Corporation’ for Staffs

LG International Conducts ‘Training to Overseas Investment Corporation’ for Staffs - 6 nights and 7 days of schedule at the coal mine and palm plantation in Indonesia; special training for second-year staffs- Aims to foster personnel with field sense … advancing their self-respect and sense of belonging to the company On May 1st, LG International confirmed that it carried out a training program to overseas investment corporation specifically for second-year staffs so that they can understand the project sites and obtain work experiences.This training was done in Indonesia for 6 nights and 7 days from April 22nd. Starting from the MPP coal mine development in 2008, LG International has regularized the projects in Indonesia. Since then, LG International expanded its resource business by continuously securing the management of palm plantation and GAM coal mine. In August 2015, it extended the business to the private hydroelectric power plant development project in northern Sumatra in order to actively take part in the infrastructure business in Indonesia.A total of 14 personnel who joined the company in 2016 were divided into teams to visit GAM coal mine and PT.PAM plantation in Indonesia, and had direct experiences and tours to the field works of the whole production process of coal and palm oil.Lee Jaewon, a staff in Power Project Team, stated: “I could feel the company’s status that it is promoting resource and infrastructure development projects in the global market, and this experience was a great help for me to acknowledge the importance of the fields and to improve business insight.”Since 2009, LG International has been administering training programs for staffs to visit major overseas corporation including China, Indonesia and other countries, and about 250 staffs have participated so far.Moon Hyunjin, head of LG International Human Resources Management Team, said “We are making an effort to promote competent personnel by constructing internal education systems that aim to systematically develop abilities necessary for each position,” and further claimed that “To be specific, in the case of the overseas investment corporation training program, the staffs have high participation satisfaction because it is possible to develop the field sense of major projects and understand business works.”Meanwhile, LG International is supporting new employee training where new employees and staffs can learn basic skills about their duties, one-to-one mentoring and other personnel exchange programs for easy adaptation of employees to their duties and the organization. Also, it offers various opportunities to enhance business professionalism by establishing in-company education programs about business planning and development, etc. (The end) [Picture 1] LG International staffs visiting the GAM coal mine are showing passionate spirit on the field in Indonesia. [Picture 2] LG International staffs participating in the overseas investment corporation training program are listening to the explanations about the business at the control room in the Indonesia GAM coal mine. [Picture 3] LG International staffs participating in the overseas investment corporation training program are listening to the explanations about the mining plan along with checking the ground plan at the Indonesia GAM coal mine field.

LG International started commercial operation

LG International started commercial operationof Wuwei thermal power plant in China - Joint venture with a Chinese government-owned power company Construction completed two years after the conclusion of the contract in 2015- Achieved consecutive outcome from the power generation sector in infrastructure business which will boost the development of new projects The whole view of Wuwei thermal power plant in Gansu Sheng, China On the 20th, LG International announced that the Wuwei thermal power plant, which was built through a joint venture with the representative power company of Gansu province in China, Gansu Province Electric Power Investment Group Co., Ltd (GEPIC) has recently commenced with operation and is producing power. Wuwei thermal power plant is the first cogeneration power plant in Wuwei city, built in an area of 410,000㎡ with a total project cost of 3.18 billion RMB. The power generation capacity is 700MW, which can produce about 6 million MWh of electricity and heating energy. This amount can be used by small cities with a population of 500,000. Especially, during the winter season, heating energy can be provided to an area of 14.77 million ㎡. The entire production of electric power will be supplied to the State Grid Corporation of China (SGCG) and companies with large scale power consumption. In October 2015, LG International signed a joint venture agreement with Gansu Province Electric Power Investment Group Co., Ltd for Wuwei coal-fired cogeneration plant and by investing 318 million RMB LG international now holds the share of 30%. Gansu Province Electric Power Investment Group Co., Ltd is a major power company owned by the government under the government policy, and is made up of 100% investment from the government of Gansu province. Other than the power generation business, Gansu Province Electric Power Investment Group Co., Ltd is also pursuing various development projects in energy, logistics and the real estate sector. Additionally, in 2016, Gansu province in China maintained stable economic growth rate with gross production of 708.5 million RMB. In particular, the prospect of future development is considered to be positive since Gansu province has been highlighted as a major logistic hub in the One Belt One Road Strategy proposed by China’s President Xi Jinping in 2013. With the growing opportunities for investment to the power generation and industrial infrastructure business in the northwestern region of China with high growth potential, LG International is planning to implement enterprise-wide efforts to expand the business in China, which has accumulated considerable expertise with resource businesses. ◆ The Hasang Hydroelectric power plant project in Indonesia is also underway. The project is planned to be completed by 2019. Bird’s eye view of Hasang Hydroelectric power plant in Indonesia Meanwhile, the power generation sector in the infrastructure business accelerated by LG International is gradually displaying the outcome. The hydroelectric power plant project in Indonesia invested by private capital is also heading forward smoothly following the projects in China. In 2015, LG International had decided to develop the Hasang Hydroelectric power plant project producing 41MW with the local energy company, Titan Group. And the company is leading a construction project in the Toba region in North Sumatra, with the targeted completion year by 2019. LG International holds 91.98% of the share which makes the company the largest shareholder. Investment in the hydroelectric power plant is made through private capital and is constructed and owned by the private company. The project is a BOO(Build-Own-Operate) type project which means collecting investment costs with direct operation. More importantly, LG International secured an agreement for 30 years of long term power purchase with the owner company, Pelayanan Listrik Negara(PLN). According to the industry analysis, power generation business can make long-term and stable profits based on the power supply contract leading to a synergy effect with the resource business which means it can lead to stronger business competitiveness. LG International is planning to expand the power generation business in South East Asia as well as the Middle East region which will accelerate the development of the new power generation project based on project experience and local expertise. [Reference] ‘One Belt One Road’ Strategy‘One Belt One Road’ is the combination of ‘One belt’ – the Silk Road economic belt that connects China to Central Asia and Europe- and ‘One Road’ – 21c maritime Silk Road from Southeast Asia through Southwest Asia to Europe and Africa based on the maritime cooperation between ASEAN-countries. The Xi Jinping administration has indicated that the development of the local economy is the key assignment of the 13th five-year plan and is now proceeding with the implementation of the ‘One Belt One Road’. Through this plan, the administration is expecting to witness outcomes such as a vibrant domestic economy, stronger economic cooperation with foreign countries and maintaining its status as an economic power.

LGI CEO Song Chi-Ho is Promoted to President

LGI confirmed the 2017 annual appointment of executives during the board meeting held on the 1st of the month and announced the promotion of one president, one senior vice president, and two vice president. During this meeting, executive vice president(CEO) Song Chi-Ho who has built a stable business structure based on resources and infrastructure and secured future growth engines was promoted to president(CEO). President(CEO) Song joined LGI in 1984 after graduating from the Department of Economics of Korea University. He was s head of the Industrial Materials Group 2, head of the Indonesia Region, head of the Resources and Raw materials Group, and the executive vice president(CEO) of LGI. President(CEO) Song is known as ‘the legitimate LGI-man’ who has successfully managed resources and infrastructure investment projects both at his office and on the sites. In addition, LGI promoted vice president(CFO) Park Yon-Hwan who led the establishment and implementation of the medium and long-term strategy of the company to that of an senior vice president. Baek Pungryeol (head of the Food&Commodities Division) and Kang Seong-Cheol (head of Jeongdo Management Division) were also appointed to the vice president. A representative of LGI stated that, “LGI has actively appointed young and capable talents to promote various projects and vitalize the organization” and added, “We will continue to strive to build a stable and sustainable business structure and strengthen our competitiveness through these new appointments.”

LGI Successfully Developed a Large-Scale Coal Mine in Indonesia

LGI has successfully developed a large-scale coal mine in Indonesia after four years of hard work.LGI announced on the 29th that it held a completion ceremony at GAM Coal Mine located in the East Kalimantan, Indonesia. About 40 participants including CEO Song Chiho, employees and executives of LGI, and CEOs of partner companies in Indonesia attended the ceremony and successfully celebrated the pilot production. ■ The Successful Development of a Large-Scale 220 Million Ton Coal Mine and the Commercial Operation Will Begin Next January.GAM Coal Mine is an open-pit mine located on a 106㎢ of land that is 36 times larger than Yeouido (2.9㎢). It is a large-scale mine with roughly 220 million tons of mining reserves. The pilot production which began this month will continue through until the end of this year when the commercial operation will begin in January. The production size will be about 3 million tons and the output will be gradually increased up to 14 million tons.LGI reserved all rights for all of the coal produced at GAM Coal Mine and will be supplying the product to major markets in India, China, and other Asian countries.In particular, demand for power is skyrocketing in the majority of major developing countries in Southeast Asia due to its consistent economic growth. Therefore, it is expected that the use of cost-effective coal power facilities will also expand since the current power infrastructures in those countries are in extremely poor condition.Also, due to its location, GAM Coal Mine is also able to secure strong competitiveness in transportation. Other coal mines in Indonesia are located about 100 to 300km away from an outer port whereas GAM Coal Mine is only 60km away from the port. The ideal location of the coal mine will secure cost competitiveness as well. ■ LGI will grow as a major company in Asia after the Second Successful Development of a Coal Mine in IndonesiaLGI is emerging as a major coal supplier in Indonesia as it has successfully developed the GAM Coal Mine in Indonesia following on from the success of the MPP Coal Mine.The successful completion of MPP Coal Mine served as a strong foundation for the successful development of GAM Coal Mine. MPP Coal Mine was taken over by LGI in 2007 and it is the first coal mine that was successfully developed by a domestic trading company from exploration to the production phase. Currently, the scope of its production size is about 3 million tons per year and it is also perfectly equipped with the necessary facilities and manpower in addition to the transportation infrastructure including roads and a port.A representative of LGI stated that, “LGI will grow as a major Asian company by using the GAM & MPP coal mines as the major coal production base which will lead to the expansion of the size of production in Indonesia by 2020.” and added, “LGI will be then able to contribute to improving the power shortage in developing countries in Asia.” ■ Achieved Success after 4 Years of Hard Work by Overcoming Many Difficulties Associated with Land Compensation, Permits, and Inadequate InfrastructureLGI acquired a 60% share of this coal mine in 2012 and secured the operating rights. Since then, the company overcame many difficulties related to land compensation, permits, production and the construction of transportation infrastructure one by one and achieved a successful outcome.The company experienced some difficulties in the course of the project development due to the distinct land compensation system of Indonesia, and permit issues caused by overlapping mineral rights and forest rights. However, LGI successfully solved those issues by actively communicating and cooperating with related local government offices. In addition, the Embassy of Korea in Indonesia also actively supported LGI.CEO Song Chiho conducted meetings with the CEOs of local partner companies for the construction of the infrastructure of the coal mine including the port and land. At the same time, the management team and other working-level teams at the headquarters and the site worked together for the successful completion of GAM Coal Mine despite the difficult project environment. CEO Song Chiho of LGI (second from right) is pressing a control button of the production facility to commence with the pilot operation of GAM Coal Mine. LGI will begin the commercial operation of the plant from next January and will increase the production size from 3 million tons up to 14 million tons in the future. <Reference> The location of LGI’s GAM Coal Mine

A Unique ‘SO:POONG’ Event of LGI for a Better Communication Environment

LGI rolled up its sleeves to improve the levels of communication within the company. The purpose of the workshop was to create an organizational culture that will enable the employees to feel pride and passion as professional businessmen while enjoying their work. CEO Song Chi-Ho held the ‘SO:POONG’ event on the 12th floor at LG Twin Tower in Yeouido with 300 employees in attendance. This is a completely different event from the regular Morning Assembly that are held every quarter. Various events and lectures were prepared to enhance the participation of all employees and executives and help them to have fun while smoothly communicating with each other. Each participant received a ‘fortune cookie’ during the event and some of them won surprise gifts. In addition, they also made and flew paper planes on which they wrote their hopes and wishes for the management group or their colleagues. Meanwhile, a mutual communication channel for the management group and employees, Future Board, was officially launched during the event. Future Board is an internal communication tool that means, ‘a council for future preparation’ and was created to allow for the smooth communication between the management group and employees to better understand each other, improve the organizational culture, and promote the development of the company. CEO Song Chi-Ho highlighted the improvements that must be made for the better organizational culture of LGI during the event to the participants and said, “LGI must be a company where you can feel pride as a professional businessman, exert passion, and enjoy your work.” LGI plans to promote various cultural activities within the organization to focus on ▲the smooth communication between the management and employees, ▲professionalism ▲strong relationship between co-workers ▲enhance the happiness of families and society. CEO Song said, “You must be happy and enjoy your work so you can stay focused and come up with creative ideas” and added, “I will strive to create the distinct culture of LGI where people communicate with each other well while staying strong, tenacious, and smart”Executives and employees of LGI gathered together on the 12th floor at LG Twin Tower in Yeouido and are flying paper planes on which they wrote their hopes and wishes for the company and their colleagues.

LGI Launched the ‘Future Board’ for Effective Communication

LGI chose effective communication as the first goal of this year.LGI announced on the 5th of the month that it has launched a mutual communication channel for the management and employees, known as the ‘Future Board’ this year. Future Board is an internal communication tool that means, ‘a council for future preparation’ and was created to allow for the smooth communication between the management group and employees to better understand each other, improve the organizational culture, and promote the development of the company. The introduction of the Future Board will help the management group to share business plans, major issues, and management policies with the employees in real time whereas the employees can suggest their ideas for the organizational culture and working environment.17 employees who represent each Business Division will be selected to operate the Future Board and the CEO, head of each Biz.Group, Management Planning Division, and HR Division will also join as council members.A representative of LGI stated that, “The importance of communication and teamwork is growing due to the uncertainties of the management environment.” and added, “We already had a presentation on the Future Board at the end of last year for all employees and executives and plan to officially launch the council this March”.Meanwhile, each team and division of LGI is regularly holding meetings to improve the communication culture of the organization and is also frequently holding the same types of meetings for new employees and employees who are to be promoted.

LGI Announced the Appointments of Executives in 2016

LGI finalized the 2016 annual appointment of executives after the board meeting on the 27th of the month and announced the appointment of two new vice president. Hong Hyeong-Gi who led the expansion of coal projects in Indonesia and increased the profitability as a Head of the Indonesia Caol Business Unit and Lee Chang-Hyeon, a Head of Coal Business Division 1, were promoted to vice president. A representative of LGI stated that, “Talents who contributed in playing a leading role in new markets with their leadership and specialty were appointed strictly based on their skills and performance” and added, “LGI will continue to strive to build a business structure that can stably create profits and strengthen our competitiveness with our new directors.”

LG International Signs Agreement to Enter into Partnership with Wuwei Coal-Fired Combined Heat & Power Plant

LG International Signs Agreement to Enter into Partnership with Wuwei Coal-Fired Combined Heat & Power PlantLG International Corporation held a signing ceremony Tuesday for the Wuwei Coal-Fired Combined Heat & Power Plant, Gansu Province, China, with Gansu Electric Power Investment Group (GEPIC), a leading Gansu Province-based investment company, at LG Twin Towers in Yeouido, Seoul.Participants in the ceremony included LG International CEO Song Chi-ho, GEPIC President Li Ningping, and a dozen other officials from both entities.At the ceremony, Mr. Song, LG International CEO, said, “We look forward to strengthening the strategic relationship between the two companies with this joint investment partnership, which has been considered a successful entry into northwestern China, where the potential for growth is high.”The two companies signed an MOU in March, and reached an agreement to make a joint investment in the Wuwei Coal-fired Combined Heat & Power Plant. A total of RMB 3.25 billion (about KRW 599.6 billion) will be invested in the Wuwei Plant project. Construction of the power plant will be completed in the second half of 2017, after which the plant will begin commercial operations.

LG International Corp. ? Hyundai Engineering Completion of the Turkmenistan Oil Refinery

LG International Corp. – Hyundai Engineering Completion of the Turkmenistan Oil RefineryLG International Corp. has announced completion of the project to modernize the Turkmenbashi Oil Refinery. The completion ceremony was held at the plant on the 9th.The ceremony was attended by Oil and Gas Vice Prime Minister Baymyrat Hodjamuhammedov, other high-ranking Turkmenistani government officials, LG International CEO Song Chi-ho, Hyundai Engineering President Kim Wi-chul, and other senior South Korean businessmen.The project site is located at Turkmenbashi, some 500 km northwest of the capital city of Ashkhabad. The consortium of LG International and Hyundai Engineering won the project in 2012 from Turkmenistan’s state-owned oil refining company for $464 million. Built in 1943, the dilapidated refinery had become inefficient, but the revamping will turn it into a modern facility that will annually produce 2.3 million tons of premium high-octane gasoline.The project is the 2nd by the consortium of the two South Korean companies – the previous project was the $1.3 billion Galkynysh Gas Desulfurization Facility completed in September 2013. This current project is considered to be an opportunity to strengthen the companies’ foothold in the petrochemical market in Turkmenistan.Since its entry into Turkmenistan in 2009, LG International Corp. has been active in making inroads into the Central Asian plant market to explore new markets and diversify its market reach. As the result of such efforts, a total of seven plant projects are in place, including the completed Galkynysh Gas Desulfurization Facility, and the project to modernize the Turkmenbashi Oil Refinery – with a combined total value of over $10 billion.Thanks to President Park Geun-hye’s visit in June last year and Turkmenistani President Gurbanguly Berdymukhammedov’s return visit in April this year, new projects by the two companies include a $3.9 billion ‘natural gas-to-liquid plant,’ a $940 million ‘2nd project for oil refinery modernization,’ and a $2 billion ‘No. 2 gas petrochemical plant’ (for which an MOU was signed). The increasing momentum is opening a new chapter in the success story, through active support from the two governments.Based on such achievements, LG International has set up a strategy – by building a stronghold to actively seek new projects – to win plant construction projects, not just in Turkmenistan but also elsewhere in Central Asia, where there is ample potential to develop natural resources such as oil and gas.Turkmenistan has been implementing mid- and long-term development plans to massively expand its industrial infrastructure by 2030. LG International will actively seek further project opportunities in connection with these development plans.<The Turkmenistan Plant Project by the LG International–Hyundai Engineering Consortium> Project NameOrder ReceivedPurchaserContract ValueConstruction PeriodNotesGalkynysh Gas Desulfurization Facility2009State-owned gas company$1.29 billionJan. 2010 – Dec. 2014CompletedTurkmenbashi Oil Refinery Modernization2012State-owned oil refining company$460 millionJun. 2012 – Sep. 2015Completion Ceremony held on Oct. 9Ethane Cracker Plant2013State-owned gas company$2.98 billionJul. 2014 – May 2018Consortium of Hyundai Construction & Toyo EngineeringKiyanly Oil Processing Facility2013Petronas$240 millionJun. 2013 – Feb. 2016 GTL Plant2015State-owned gas corporation$3.89 billion63 months after work begins Turkmenbashi 2nd Project for Oil Refinery Modernization2015State-owned oil refining company$940 millionJan. 2016 –Jul. 2019 No. 2 Gas Petrochemical PlantMOU Signed (Expected in 2016)State-owned gas corporation$2 billion (not yet fixed)Undecided <View of the Turkmenbashi Oil Refinery><Site Map of the Turkmenbashi Oil Refinery Modernization Project>

LG International constructs ‘Bridge of love’ in Indonesia and as an activity fulfilling Corporate Social Responsibility

“I love you! LG International bridge of love” LG International constructs ‘Bridge of love’ in Indonesia and as an activity fulfilling Corporate Social Responsibility- Reconstructed a falling bridge near LGI’s palm plantation area in Indonesia for safety and convenience of community residents.- Construction expense was supplemented by donation by LGI employees and the company will constantly put additional efforts to practice social contribution.LG International practiced corporate social responsibility by reconstructing a sturdy bridge in Indonesia.LG International replaced a falling wooden bridge with a stone bridge near the company’s palm plantation area located in Sekadau, Western Kalimantan, Indonesia.The former bridges were severely damaged and worn but being used as the main route to 8 elementary, middle and high school which could have led to accidents. Yudi(30) said “I am very glad a new bridge is being donated to the community”, and added “There is no longer a need to worry whenever crossing the bridge”.The construction expense of the newly built bridge was completely supplemented by voluntary donation by LGI employees. The company has been running a matching-grant donation system from 2012 where LGI donates the equivalent amount the employees donates for community.An LGI official said, “We expect replacement of the bridge will help improve safety and convenience of community residents”. “We plan to constantly put additional efforts to practice social contribution as a good example” he added.LG International has been actively practicing a variety of social responsibility activities such as free meal delivery, support for restoration from natural disasters, scholarship award, sponsoring sporting and culture activities. ▲ Local residents, students and LGI employees working at Palm subsidiary are waving hands at the ‘Bridge of love’.

LGI propels its industrial infrastructure business

LGI propels its industrial infrastructure business- Following its entrance into coal-fired cogeneration business in China, the company is launching a private hydro power generation business in Indonesia- A hydropower plant with a capacity of 41MW located in Northern Sumatra is scheduled for completion in 2018- Secured ownership and operation rights over power plant facilities which ensures a stable profit by signing a 30-year power purchase agreementFollowing the entrance into coal-fired cogeneration business in Gan Sushen, China, LGI is pushing ahead a private hydro power generation business in Indonesia in a bid to penetrate industrial infrastructure businesses.On August 20, LGI formally announced that the company, together with Indonesia’s energy specialist, the Titan Group, will push ahead with the construction of the Hasang Hydropower Plant in Indonesia.The Hasang Hydropower Plant will be constructed as a run-off river type, which uses the head drop at the tunnel’s exit to generate power. The plant will have a power generation capacity of 41MW. This power plant, which will be constructed on a 700,000 square meters sprawling site in Toba, North Sumatra, in Indonesia, will begin construction at the end of this year, and will be completed in the second half of 2018.This project will be carried out with private capital under the BOO (Build-Own-Operate) method, by which private companies construct the plant, hold ownership over the plant, operate the plant, and collect their returns on investment costs. As such, this project is also called an independent power producer (IPP) project, and LGI will have ownership and operation rights over the facilities.Last year, LGI secured the largest stake of 51% in this venture after signing a shareholders' agreement with the Titan Group. The company has since led the entire business development procedure, from local permissions and approvals to compensation for land, and from the power purchase agreement and financing to the commencement of construction and operation of the power plant. On August 19, LGI signed a 30-year power purchase agreement (PPA) with Indonesia’s state power company, PLN.The Hasang Hydropower Plant is part of the Indonesian government’s ‘Fast Track Ⅱ’ Program, which is designed to deal with the country's power shortage problem. Thus, the Indonesian government guarantees the payment of power transaction prices.Meanwhile, LGI has recently pushed its industrial infrastructure businesses dealing with logistics, power generation, and other resource businesses. Under this policy, LGI is seeking to adjust to the changing business environment that is associated with the steady fall in prices of raw materials, and to foster the industrial infrastructure business, together with its existing resources and trading businesses, as the company’s new growth engine. Based on experience in power generation businesses in China and Indonesia, LGI will explore other business opportunities for industrial infrastructure development in Myanmar, Oman, and other emerging markets with significant growth potential.▲ Map of the Hasang Hydropower Plant Location in Indonesia▲ Aerial view of Hasang Hydropower Plant

LG International invests in Gan Susheng ‘Coal-Fired Cogeneration Plant’

LG International invests in Gan Susheng ‘Coal-Fired Cogeneration Plant’- Joint venture with a major investor enterprise of Gan Susheng for a ‘Coal-Fired Cogeneration Plant’ with 70MW capacity, expected to commence commercial operation during the second half of year 2017.- Preparing a foundation for further expansion and development of company’s power generation business into northwestern China.- Reviewing feasibility of coal fuel supply, and expecting further boost industrial infrastructure business which links with natural resources development.LG International has decided to invest in a coal-fired cogeneration plant in China. The company announced on August 13 that it invested RMB 339 million (KRW 62.5 billion) for a 30% stake in the coal-fired cogeneration plant to be constructed in the vicinity of Wuwei, Gan Susheng.Under the joint venture between LGI and Gansu Province Electric Power Investment Group Corporation (GEPIC), a major Gan Susheng investor, the Wuwei coal-fired cogeneration plant will be constructed with a capacity of 700MW at a cost of RMB 3.25 billion (KRW 599.6 billion).Construction of the first cogeneration plant in Wuwei will be completed and begin operating in the second half of 2017. This power plant will use coal as fuel to generate electricity and heating energy, to supply to the region.This investment by LGI in the Wuwei coal-fired cogeneration plant comes just five months after LGI and GEPIC signed an MOU in March. Both companies had formed a strategic alliance to pursue power generation and logistical infrastructure projects.GEPIC, a policy-oriented large state investment company established with100% investment by the province government, primarily pursues coal-fired power plant, hydroelectric, and wind power generation businesses, as well as the development of coal, railroad, logistics and real estate.This investment is profoundly meaningful because we have entered northwestern China, which offers big development potential in association with China’s One Belt One Road policy, and because we have laid grounds for the expansion of our overseas power generation business. Notably, in the long term, we are reviewing the supply of coal as fuel, so we expect to create big synergies between power generation and resource development businesses.Starting from developing coal mines in Nei Mongol Autonomous Region in 2008, we were first South Korean company to buy coal chemical urea plants from China.[Reference] Gan SushengGan Susheng, bordering China’s inlands including Shanxisheng, Qinghaisheng, Xinjiang Uyghur Autonomous Region, and the Inner Mongolia Autonomous Region, is located in the middle and upper streams of the Yellow River. According to the Xi Jinping government’s plan for constructing the One Belt One Road (the overland and marine Silk Road) project, Gan Susheng is receiving considerable attention as it is emerging as the key part in the economic development area along the overland Silk Road that connects Central Asia and Europe. The province, diversifying its industrial structures focused on light and heavy industries, is expected to offer high growth potential in northwestern China’s development.[Reference] One Belt One Road (the overland and marine Silk Road) strategyOne Belt symbolizes the economic development area along the overland Silk Road that connects China and Central Asia and Europe. One Road, on the other hand, is based on the marine cooperation with ASEAN nations, the 21st century marine Silk Road that connects Southeast Asia, Southwestern Asia, Europe and Africa. The One Belt One Road strategy combines these two vital aspects of regional economic development, which the Xi Jinping government has defined as a key task in China’s 13rd five-year economic development plan (13•5 Plan). China thus expects to invigorate its domestic economy, bolster foreign economic collaboration, secure resources, and maintain its massive economy profile.▲ Map of Gan Susheng Wuwei’s coal-fired cogeneration plant in China▲ Bird’s-eye view of Gan Susheng Wuwei’s coal-fired cogeneration plant in China

LGI Delivers Lunch Box to Marginalized Children.

LGI Delivers Lunch Box to Marginalized Children.- Employees prepared packed lunch for 150 marginalized children- Through the company’s volunteer service guarantee system, the employees were encouraged to join community service projects- The company is implementing the matching grant system to expand its CSR activitiesLGI is giving away lunch packed in lunchboxes (“lunchboxes”) to marginalized children as part of its community outreach efforts. Employees volunteered to raise the funds needed to prepare the lunchboxes, and to deliver them to children from financially challenged homes.Employees have been donating a fraction of their salaries for charitable activities since September 2012. With the funds estimated at around KRW110 million, they have provided lunchboxes to 150 marginalized children on five occasions per week since the end of last year. They went to welfare facilities and prepared and packed the lunchboxes there.The company implements the weekday employee volunteer service guarantee system with a maximum volunteer service time of eight hours per day. This company policy was established to encourage the employees to positively engage in community volunteer services. This campaign does not only raise funds but also involves the employees in corporate social responsibility (CSR) activities associated with community outreach services.Furthermore, LGI implements the matching grant system. Under this system, the company donates funds equivalent to the employees’ donations to further boost its community outreach activities. The funds raised through the matching grant system will be used to improve the infrastructure for the residents in the company’s overseas business areas, among other community development activities.▲ LGI employees preparing lunchboxes for marginalized children. The company implements the weekday employee volunteer service guarantee system with a maximum volunteer service time of eight hours per day, in support of the employees’ volunteer activities.

South Korea ? Turkmenistan Summit Strengthens Diplomatic Ties LGI ? Hyundai Engineering Consortium to Expect KRW 5 Trillion Plant Orders in Turkmenistan

South Korea – Turkmenistan Summit Strengthens Diplomatic Ties LGI – Hyundai Engineering Consortium to Expect KRW 5 Trillion Plant Orders in Turkmenistan- President Park visited three CIS nations last June, and is now reaping economic and diplomatic benefits- Meanwhile, Turkmenistan President is visiting South Korea on April 11-14, and LGI is looking forward to sign one agreement and one MOU- Earlier this year, Hyundai Engineering already won KRW 2.2 trillion plant construction orders in Uzbekistan, and this deal is yet another business success in the CIS.- Hyundai Engineering and LGI: with the government’s positive economic and diplomatic endeavors, Central Asia is emerging as a strong business growth area.The LGI-Hyundai Engineering Co. (HEC) consortium has virtually won KRW 5 trillion worth of projects in Turkmenistan, including the modernization of its oil refinery plants, and the construction of gas-to-liquid (GTL) plants.Last June, President Park Geun-hye visited three CIS nations (Uzbekistan, Turkmenistan, and Kazakhstan) in a bid to take a Eurasia initiative, which resulted in two leading Korean companies winning large scale orders from the CIS.■ During Turkmenistan President’s visit to South Korea, one agreement and one MOU were signedUpon Turkmenistan President Gurbanguly Berdimuhamedow’s visit to South Korea, LGI and HEC announced that they will sign an agreement with Turkmenistan's state petroleum company involving a USD 940 million (KRW 990 billion) project to modernize oil refinery plants in Turkmenistan.Moreover, the consortium stated that it will sign a framework agreement with Turkmenistan’s state gas company to pursue a USD 3.89 billion (KRW 4.08 trillion) project to construct gas-to-liquid (GTL) plants.Under the modernization of oil refineries, facilities will be constructed in existing plants, located 500 km northwest from the country’s capital of Ashgabat, to remove sulfur from gasoline and diesel. The project will take 42 months.This deal is a follow-up project after the consortium won the oil refinery plant order in 2012, and has since been completing the project in Türkmenbaşy, attesting to the country’s trust in the consortium’s capabilities.The GTL plant project will construct facilities to process 3.5 billion ㎥ of natural gas a year near the capital of Ashgabat and produce diesel and naphtha. The project will take 63 months.The GTL project aims to produce clean, refined oil products from gas, and, as such, only a limited number of foreign companies have participated in such undertakings. LGI expects to spearhead this project, and further boost its competitiveness.■ Yet another substantial business success from President Park’s Eurasia initiativeThis project blossomed after President Park visited Turkmenistan last June.At the summit with Turkmenistan President Gurbanguly Berdimuhamedow, President Park Geun-hye discussed collaborative projects between the two countries, and both governments’ positive support for South Korean companies operating in Turkmenistan. Symbolically important is the first time that a South Korean president has visited Turkmenistan.Thus, with the two leaders in attendance during their summit in Turkmenistan, LGI and HEC were able to sign MOUs on GTL plants and a second gas petroleum chemistry plant project. The second gas petroleum chemistry plant project was discussed after the consortium submitted a preliminary proposal.In the meantime, the South Korean government sent a private sector-government economic collaboration delegation to Turkmenistan last month to further boost the economic collaboration between the two countries. The delegation will comprise of 30 personnel from the Ministry of Trade, Industry and Energy, the Ministry of Foreign Affairs, and the Ministry of Land, Infrastructure and Transport, Korea International Trade Association, Korea Institute of Industrial Technology, Korea EXIM Bank, and other private companies.Prior to such development, HEC signed an agreement involving a USD 2.66 billion project to construct the Kandym gas treatment plants in Uzbekistan earlier this year.This deal was revived just as President Park Geun-hye, during her summit with Uzbekistan President Islam Karimov as part of her visit to the three Central Asian nations, requested to pursue the project.Attending the agreement signing ceremony in Uzbekistan were a large number of local government officials, with the local state broadcaster covering this event. As such, the deal was a product of the South Korea-Uzbekistan summit, and was highlighted as an exemplary private sector-government economic initiative.■ LGI-HEC become strong players in the Central Asia plant marketsThe LGI-HEC consortium has established itself as a frontrunner in the plant project sector in Turkmenistan.The consortium was established in 2009 with a USD 1.4 billion gas desulfurization project in Galkynysh. It continued to secure a USD 530 million oil refinery plant project in Türkmenbaşy in 2012, a USD 240 million crude oil treatment plant project in Kiyanly in 2014, and a USD 3.44 billion petrochemical plant project.Likewise, HEC successfully won a second project deal in Central Asia in the same year.HEC is currently the largest cumulative order winner in Central Asia among Korean construction companies.As of the end of last year, HEC’s projects in Central Asia include five projects in Uzbekistan worth USD 4.12 billion, four projects in Turkmenistan worth USD 3.61 billion, and two projects in Kazakhstan worth USD 970 million, totaling 11 projects worth USD 8.7 billion.Central Asian nations have achieved rapid economic growth with its huge natural resource reserves after the 2000s, drawing attention as an emerging market for engineering industries. When there was a crisis as a result of competing for low-price orders in the Middle East and Asia, even world-class corporations were reluctant to enter the blue ocean markets of Central Asia due to political instability, lack of security, and sloppy infrastructure.HEC, however, noticed the potential of Central Asia’s plant markets early on, and positively explored the region’s markets that were not yet developed by the domestic plant industry.In particular, Turkmenistan was found to have a huge reserve of natural gas, ranking 4thin the world, enabling it to achieve an 8.5% economic growth this year and earning a reputation as a super high-speed growth nation.HEC is determined to continue to win project orders in the resource-rich Central Asia to remain competitive in such hub markets.An HEC official said, “With the government's positive diplomatic efforts, locally recognized HEC’s technology, and LGI’s marketing excellence, we are winning large-scale orders in Central Asia. We will continue to expand our businesses in the region to turn it into a major business area and secure project orders not only for HEC but for other Korean companies as well.”▲ Attachment: Site Map

LGI CEO Song Chi-ho Vows to Expand China Business

LGI CEO Song Chi-ho Vows to Expand China Business- In Gansusheng, China, the LGI CEO met the governor and signed a business MOU- He vows to create new businesses with big growth potential in northwestern ChinaGansusheng, China, March 16 - LGI CEO Song Chi-ho signed here an MOU with Governor Liu Weiping for a joint investment with Gansu Diantou, the province’s major investment group, to revitalize LGI’s China business, the company announced on March 19.Also in the meeting were Vice Governor Huang Qiang, Chief Secretary Zhang Shengzhen, and other high-ranking provincial officials.Song and Governor Liu also discussed the province’s major development plans, and agreed to cooperate for successful business investments.Gansusheng is attracting attention as the hub of the overland Economic Silk Road Belt that connects Central Asia and Europe, according to the Xi Jinping government’s One-Belt, One-Road construction plan. The province is diversifying its industries and focusing on light and heavy industries, and it is expected to achieve high growth as the center of the development of northwestern China.LGI’s MOU with the Gansu Diantou Group was on their joint investment in power generation and logistics projects. The Chinese group, Gansusheng’s 100% government-invested large investor, develops coal and railroad transport systems and runs power generation businesses such as coal, hydraulic, and wind power generation.With the MOU signing, LGI is poised to pursue strategic alliances with the Chinese Group through projects such as the construction of a coal-fired cogeneration power station in Wuwei, a hydroelectric power station in Hekou, and a coal-fired power station in Jiuquan Changle.An LGI official said, “CEO Song has keenly watched northwestern China as an area with significant economic growth potential, and has followed the One-Belt, One-Road policy trends. While on his trip there, he toured and closely observed the major business sites of the Gansu Diantou Group.”LGI began developing the Wantugou coal mine in Inner Mongolia, China in 2008, became the first Korean company to have a stake in the coal-based chemical urea plant, and further advanced into local resource development projects. As such, it is continually expanding its local businesses in the area.[Reference 1] One-Belt, One-Road (land-sea silk road) InitiativeThe word Idaiiru, meaning “one belt and one road,” combines the words Idai, which is the Silk Road Economic Belt that connects China, Central Asia, and Europe over land, and Iru, the 21st-century Marine Silk Road that connects Southeast Asia, Southwestern Asia, Europe, and Africa, in collaboration with ASEAN nations. The Xi Jinping government determined the key task of its 13th five-year economic development plan (13·5 initiative) as regional economic development, and towards that end, is pushing ahead with the Idaiiru initiative. With such initiative, China expects to revitalize its domestic economy, boost its external economic cooperation, secure resources, and enhance its global profile as a top economy.[Reference 2] Gansu Diantou Group’s major power generation projects CategoryCoal-fired cogeneration power station in WuweiHydroelectric power station in HekouCoal-fired power station in Jiuquan ChangleSize700 MW (steam: 420 t/h)74 MW4000 MW▲ LGI CEO Song Chi-Ho(left) and Governor Liu Weiping

LGI Acquires Pantos Logistics to Boost the Synergies of Trading and Logistics

LGI Acquires Pantos Logistics to Boost the Synergies of Trading and Logistics- Pushes to take over a 51% stake in Pantos for KRW314.7 billion- LGI’s global business capacity and Pantos’s logistics capacity combine to bolster LGI’s trading competitiveness and enhance its corporate valueLGI is set to acquire South Korea’s representative total logistics company Pantos Logistics to boost the synergies of its trading and logistics businesses. LGI (CEO: Song Chi-ho) held a board meeting on January 20 to resolve the company’s acquisition of a 51% stake (1.02 million shares) in Pantos for KRW314.7 billion. Through this acquisition, LGI expects to gain synergies such as the boosting of the logistical function in its resources and industrial-materials trading business, its logistical-function use, and its exploration of new business opportunities. In addition, LGI plans to operate Pantos as its subsidiary, to use its global business capacity to boost Pantos’s overseas business competitiveness, and to expand its logistics business area from containerization logistics to bulk logistics, with focus on resources/materials. An LGI official explained, “We plan to combine LGI’s global capacity and Pantos’s logistics capacity to boost our business competitiveness and corporate value.” Pantos, a total logistics company established in 1977, provides logistical services to some 2,500 clients in diverse industries, including electronics, machinery, chemicals, oil refining, construction, and distribution.