South Korea's Hyundai Engineering and Construction said Thursday it has won a $1.348 billion order to expand and upgrade a Venezuelan oil refinery.

Hyundai said in a statement it would undertake the 42-month project, worth a total of $2.99 billion, jointly with China's Wison Engineering.

It said the order for work at the Puerto La Cruz refinery, 250 kilometres (150 miles) east of Caracas, came from state-run oil company Petroleos de Venezuela (PDVSA).

"Construction will begin soon after our company signs a formal contract, probably in late June," a Hyundai spokesman told AFP.

He said the deal would help Hyundai Engineering increase its presence in South America.

"Such a refinery order is rare for our company, and we hope it will open additional deals in Venezuela and other South American countries," the spokesman said.

"The refinery deal reflects our efforts to diversity our markets," he said, adding Hyundai wanted to try and secure orders for refinery construction in Iraq and Kuwait.

The South Korean firm has a $10 billion target for overseas construction projects this year. As of June, it had won $4.3 billion worth of deals.

PDVSA is the the main source of revenue for firebrand President Hugo Chavez's government.

Last year, the company's profit rose 42 percent to $4.496 billion on the back of the rise in global crude oil prices following the Arab Spring uprisings, Venezuela's Energy Minister Rafael Ramirez announced in April.

The South American nation says it produces three million barrels per day, although the Organisation of Oil Exporting Countries estimates production at 2.3 million barrels.

The United States last year announced sanctions against "seven foreign entities" including Venezuela's state oil company as part of new efforts to contain Iran's nuclear ambitions.