Hyundai Heavy wins $600m shipbuilding deal

Hyundai Heavy

Hyundai Heavy Industries (HHI) has clinched a shipbuilding deal worth up to 673.1 billion won ($600 million) from Vitol, one of the world’s largest energy suppliers.

Under the contract, HHI will build two liquefied petroleum gas (LPG) tankers with a capacity of 84,000 cubic meters each. They are expected to be built at the shipyard’s headquarters in Ulsan, South Gyeongsang Province, and delivered in the first half of 2019. Vitol also holds the option to order six more gas carriers.

The new LPG tankers will be designed to consume less fuel and be eco-friendly to meet the International Maritime Organization’s sulphur cap set to come into effect 2020, HHI said in a press release.

“We came to choose HHI because we think highly of its brand value, technologies and financial stability,” a Vitol official said. “We will be looking forward to the delivery.”

Based on its differentiated technologies in building LPG and liquefied natural gas (LNG) carriers, HHI has so far delivered about 200 very large gas carriers (VLGCs) to a number of companies around the world.

“We deeply appreciate Vitol choosing HHI,” an HHI official said.

“We will do our best to deliver our eco-friendly tankers to Vitol on schedule.”

From 1972 to 2013, HHI delivered 2,981 vessels to 268 ship owners in 48 countries. It commands around 16 percent of the world’s shipbuilding market.

This year, HHI and its affiliates have so far received orders to build 81 ships worth $4.5 billion in total. The figure is more than a fivefold surge from the same period last year.

On April 1, Korea’s largest shipbuilder was split into four units in a bid to strengthen the core competence of its shipbuilding and other business divisions, as well as improve its financial health. HHI operates shipbuilding, offshore plants and engine operations, with three other firms managing their respective areas of business.