HHI inks $800 million deal, its biggest in 5 years

Hyundai Heavy Industries inked its biggest deal in the last five years to build 10 very large ore carriers (VLOC) for domestic shipper Polaris Shipping, according to the company on Tuesday.

The 10 carriers measure 325,000 tons per unit and will be delivered one by one by April 2021. The contract is worth $800 million in total - the biggest since HHI’s last record in 2012 to build 10 container ships for a Greek shipper.

The buyer, Polaris Shipping, placed the order after securing a charter contract with Brazil’s Vale - one of the world’s largest producer of iron ore and nickel.

According to TradeWinds - a media outlet specializing in the marine industry - the Brazilian company is in talks with Chinese and Korean shipping companies to sign contracts for 30 or so ships that would transfer exported iron ore.

Polaris has signed contracts for around 20 VLOCs from HHI since 2013.

The Korean shipping company said in a statement that it highly approved of HHI’s capacity to build ships with high fuel efficiency and eco-friendly systems.

The 10 VLOCs are designed to be “LNG Ready,” which is HHI’s technology that enables the ships to run on both fossil fuel and LNG in preparation for enforced environmental regulations from the International Maritime Organization, which will be effective from 2020.

The models are also equipped with instruments that clear the ship’s ballast water, which is inserted inside the ship for weight balance, and scrubbers, an air pollution control device.

With Tuesday’s deal, Hyundai Heavy Industries Group has secured deals for 99 ships worth $5.8 billion so far this year - a fivefold increase from year.

BY SONG KYOUNG-SON [song.kyoungson@joongang.co.kr]