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Orion-Jeju gov't feud deepens over bottled water

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Orion Chairman Dam Chul-gon, fifth from left, with participants celebrating the completion of the company's mineral water plant on Jeju Island, Tuesday. Second from right is Vice Chairman Huh In-cheol. Courtesy of Orion
Orion Chairman Dam Chul-gon, fifth from left, with participants celebrating the completion of the company's mineral water plant on Jeju Island, Tuesday. Second from right is Vice Chairman Huh In-cheol. Courtesy of Orion

By Nam Hyun-woo

Orion's Jeju Yongamsu mineral water
Orion's Jeju Yongamsu mineral water
A feud is deepening between food firm Orion and the Jeju Island government over the company's domestic sales of bottled mineral water from an underground spring on the island, industry officials said Friday.

The Jeju government has threatened to ban Orion from using the water source if the company sells the water domestically, while the company says it will push ahead with domestic sales, adding it has the right to use the source.

At a press conference on Wednesday, the Jeju government said it would stop providing the spring water to Orion, saying the government had not signed any deal with the company.

"The Jeju government has been allowing Orion to use the spring source only for testing purposes, not for domestic sales," a Jeju government official said at the press conference. "The government has reiterated that Orion cannot sell products using the source in the domestic market."

Orion launched its first mineral water product, Jeju Yongamsu (volcanic mineral water), last month. The water is produced at a plant in Goojwa-eup on the island, using a spring naturally filtered through 400,000-year-old underground basalt.

The Jeju Provincial Government manages underground water as a public good and had only allowed public firms to develop water resources on the island. One of the firms is the Jeju Province Development Company, which produces Jeju Samdasoo from a plant on the island.

To attract investment, however, the provincial government in 2008 allowed private firms to bottle water in Jeju Technopark in Goojwa-eup.

In 2016, Orion acquired a 60 percent stake in a water company in Technopark and invested 120 billion won ($101 million) to build facilities for Jeju Yongamsu. Orion initially planned to develop its own spring source, but gave up the plan in 2017 and has been using the spring provided by Technopark.

Orion's plant producing Jeju Yongamsu mineral water at Goojwa-eup, Jeju Island / Courtesy of Orion
Orion's plant producing Jeju Yongamsu mineral water at Goojwa-eup, Jeju Island / Courtesy of Orion

The Jeju government said it allowed Orion to sell Yongamsu only overseas, and claimed the company also had agreed to produce the product only for export. The government added that selling the water domestically was against the province's principle of prohibiting private firms from making a profit off a public good.

In reply to the provincial government's claim, Orion said it could not export water that it did not sell in the domestic market, and stated its intention to continue sales.

Orion Vice Chairman Huh In-cheol told a press conference, "Orion is a company located in Technopark, and thus has the right to receive the groundwater."

Huh said he met Jeju Governor Won Hee-ryong twice and told him that Orion could not accept Jeju's ban on domestic sales, which was an unfair restriction on competition. He added that Orion promised to return to Jeju Island 20 percent of profits from the product.

An Orion official said another company in Technopark was selling its bottled water in the domestic market, and Orion would consult the Jeju government to prevent potential problems.

Orion plans to produce 240 million bottles of Yongamsu per year at the plant, and began domestic sales this month, as well as planning to export the product to China in the first half of next year.



Nam Hyun-woo namhw@koreatimes.co.kr


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