DSME, Hyundai Heavy start the new year with orders

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DSME, Hyundai Heavy start the new year with orders

Korean shipbuilders started the year with new orders for crude carriers, signaling an improved market.

Daewoo Shipbuilding and Marine Engineering (DSME) said Friday it won orders to build two very large crude carriers (VLCCs) from Oman Shipping Company (OSC).

The deal is valued at 210 billion won ($187.2 million).

The ships will be built at the shipbuilder’s Okpo Shipyard in Geoje, South Gyeongsang, and delivery is expected by the fourth quarter of 2020.

The two vessels will be 336 meters (1,102 feet) long and 60 meters wide, with 300,000 ton capacities. Their engines will comply with environmental guidelines by the International Maritime Organization.

DSME built a relationship with the Oman government in 2006 when it inked a 10-year contract to build and manage a repair shipyard for Oman.

During the period, roughly 450 ships were repaired there, according to the Korean shipbuilder.

DSME won orders to build five VLCCs from Oman’s state-run shipping company in 2008. The latest order is the second inked with OSC since then.

DSME said it will continue focusing on high-value added ships like liquefied natural gas carriers and VLCCs this year. Last year, the shipbuilder inked orders to build 16 VLCCs, the most in the world for that type of ship.

The shipbuilder’s very first order of the year was for four VLCCs from a shipping company worth 409.5 billion won. It did not name the company.The orders for six VLCCs are equal to about 40 percent of the total orders landed last year.

Hyundai Heavy Industries Group also announced on Friday that it won a 155 billion won worth order to build two crude carriers from a shipping company based in Europe.

It is the first order the group won this year.

The crude carriers with 158,000-ton capacity will be 274 meters long and 48 meters wide, the shipbuilder said. Hyundai Samho Heavy Industries, a shipbuilder under the group, will be building the ships to deliver from late 2020.

Hyundai said its shipbuilding order target this year is $15.9 billion, a 21 percent rise from last year’s target and the highest target since 2014.

“We factored in a recovery in shipbuilding market conditions,” the company said in statement.

A spokesperson for the group said shipping companies have been actively reaching out to the group from the beginning of the year.

Shipbuilding market tracker Clarksons Research projected that global shipbuilding orders this year will be around 34.4 million compensated gross tonnage (CGT), up 20 percent from last year’s 28.59 million CGT.

CGT reflects both the number of ships and the level of complexity involved in making them.

Clarksons said ship demand will continue to increase and hit 47.4 million CGT by 2023.

BY KIM JEE-HEE [kim.jeehee@joongang.co.kr]
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