Korea Shipbuilding and Offshore Engineering Co. (KSOE) the world's biggest shipbuilder by order backlog, has secured deals to build five vessels, including LNG-powered containerships, a week after the European Commission vetoed the nation’s huge shipbuilding merger between Hyundai and Daewoo.
KSOE said the orders for the five cargo vessels were valued in total at 511 billion Korean won ($428.5M).
KSOE, whose affiliates include Hyundai Heavy Industries, Hyundai Mipo Dockyard Co. and Hyundai Samho Heavy Industries, has now ($1.83Bln) worth of ship orders for the first half of January 2022.
The previous orders included building six 15,000 20-foot equivalent unit (TEU) LNG-powered containerships.
Under the most recent two separate deals, KSOE will build three 7,900 TEU LNG-powered container ships and two 50,000-ton petrochemical carriers owners in Asia who didn’t want to be named by KSOE.
The container ships will be delivered to the ship owner from the first half of 2024, and the petrochemical carriers will be delivered in the second half of 2023.
Sales target
KSOE said it aimed to win $17.5Bln worth of orders in 2022, higher than last year's target of $14.9Bln. In 2021,the company achieved $22.8Bln worth of orders.
Daewoo Shipbuilding & Marine Engineering (DSME), a smaller rival to KSOE, has also issued a statement saying it had won an order worth over $200M to build a large LNG carrier to be delivered by the end of 2024 and giving no other details.
The European Union antitrust regulator on January 13, 2022, vetoed the proposed acquisition by Hyundai Heavy Industries of DSME, saying the transaction could create a monopoly in the LNG carrier market.
“The merger between the two South Korean shipbuilders would have created a dominant position by the new merged company and reduced competition in the worldwide market for the construction of LNG,” said Commission Executive Vice-President Margrethe Vestager, in charge of EU competition policy.
“The parties did not formally offer remedies to address the Commission's concerns,” she added.
“Large vessels are an essential element in the supply chain of LNG and enable the transport of this source of energy around the globe,” explained Vestager.
“LNG contributes to the diversification of Europe's source of energy and therefore improves energy security. The merger between HHI and DSME would have led to a dominant position in the global market for the construction of large LNG vessels, for which there is significant demand from European carriers,” she stated.
