HHI lands $220 million bid to build 3 VLGCs

Hyundai Heavy Industries (HHI), Korea’s largest shipbuilder, landed an order to build three gas tankers, the company’s third batch order so far this year.

The Ulsan-based shipbuilder announced on Thursday that it inked a contract with Kuwait Oil Tanker Company (KOTC), the state-run oil shipping company of Kuwait, to build three Very Large Gas Carriers (VLGCs). The deal is worth about $220 million, according to the shipbuilder. Ships will be constructed at the company’s shipyard in Ulsan and will be delivered to the KOTC in 2019.

As a result of the deal, HHI and its subsidiaries have clinched orders to build a total of 14 ships so far this year, which is worth about $800 million together. It’s the highest number of orders that the company has logged in the month of January since 2014.

Earlier this month, Hyundai Samho Heavy Industries, a shipbuilding affiliate of HHI, secured an order to build six ships which included Very Large Crude Carriers and Very Large Ore Carriers. Another affiliate Hyundai Mipo Dockyard earned a deal to build five ships as well.

HHI is considered the leading shipbuilder in the world for VLGCs. In 2016 and 2017, when the shipbuilding industry was suffering in a recession, Hyundai Heavy was the only shipbuilder in Korea to land orders to build seven VLGCs. According to Clarkson Research, which specializes in the shipbuilding industry, 119 out of 268 VLGCs operating globally were constructed by the company.

HHI explained that with the global shipbuilding industry showing signs of recovery this year, the company hopes to ink additional orders. According to sources, HHI’s target for the year is $13.2 billion.

“We have had a number of inquiries from the onset of the year,” said a spokesperson from HHI. “We expect to land additional orders for ships such as LNG carriers and product carriers.”

BY CHOI HYUNG-JO [choi.hyungjo@joongang.co.kr]