SK Engineering & Construction, a leading South Korean builder, said Wednesday it has started work on constructing a $1.2 billion thermal power plant in Chile.

The project near the Mejillones region, 1,200 kilometers north of Santiago, includes building two 375 megawatt coal-fired generators. The power plant, once it goes online in December 2018, will be the largest of its kind in the South American country. The plant will provide electricity to nearby mines and to a local electric power company for distribution.

SK E&C said it signed a deal with private Chilean utility company E-CL to start pre-construction work at the site.

The builder is in charge of engineering, procurement and construction, and plans to kick off full-fledged work in March next year.

It said Chile is expected to invest $100 billion to develop mineral mines that need at least 8,000 megawatts of electricity.

SK E&C was tapped as the primary negotiating partner for this project in August 2013 by beating Spanish and Italian rivals. (Yonhap)