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Feature 1 | SOUTH KOREA


SPP will follow market demand and will start to build chemical and product tankers says the yard management


received this year are not nearly enough to cover the yard’s costs. In such a challenging climate Sungdong


has devised a strategy to cut its costs. “Te plan is to shut down one third of the yard,” explains Koo, “we have six skids and will shut down two next year and we are looking to subcontract offshore work from larger yards if there are still no meaningful orders in the third and fourth quarters.” To say the orderbook in Korea’s yards has


diminished is to understate the case. In fact this year has seen such a poor performance by the Korean yards across the board that the member yards of the Korean Shipbuilders’ Association (KOSHIPA) have instructed their representative body to withhold details of this year’s new orders. Not all of Korea’s yards are suffering in


the way that Sungdong and 21st Century are, at least one, SPP, claims that it is maintaining its position in the market and hopes to come out of the recession stronger. “Some 80-90% of our employees are


former Hanjin workers,” explains SPP executive vice president of


the sales


and marketing department Socrates Park (known as Socrates following his placement in Athens). He went on to say that the company has retained some 1,000 direct employees, many of them former


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Hanjin designers, and around 5,000 sub-contractors. Park says that SPP has concentrated


on around six vessel types over the last five years, Kamsarmax, Handymax and Supramax bulk carriers and medium range tankers, around 50,000dwt and long range tankers of 73,000dwt and 113,000dwt. “We cannot compete with the Chinese


on bulk carriers, now,” explains Socrates so the company will concentrate more on high value vessels. In future SPP will look for orders of small to medium sized LNG and LPG carriers as well as ethylene tankers. “In 2016 environmental regulations will


change and we have requests from clients for new dual-fuel designs and we must follow market demand,” says Socrates. SPP is looking at the closure of chemical


and products plants in the US and Japan with new manufacturing centres being built in Saudi Arabia and India. SPP will look to take advantage of the chemical shipping demand that will be derived from these new plants. “We can’t compete with the big yards


for large vessels but small to medium sized ships, 10,000m3


LNG bunkering vessels, 12,000-22,000dwt ethylene carriers and


38,000dwt prismatic LPG carriers are a possibility for us,” claims Socrates. The yard is currently developing the


design concepts for these new vessels with Wärtsilä and MAN Diesel & Turbo. For example the 50,000dwt MR tanker will have a reduced fuel consumption of 23tonnes/ day, “the lowest fuel consumption in the world,” claims Socrates. In addition slender hull forms along with


electronic injection and optimised shaſt and propeller functions will help to maintain the fuel efficiency of the new designs. Even with SPP looking at successfully holding on to its tanker business while conceding bulk carriers to the Chinese, the wider Korean picture is of a shiſt to new markets. It is no secret that around 60% of new


orders in South Korea have been in the offshore sector and that the offshore market is beginning to challenge the shipbuilding sector for top spot at Korean yards. The big three Industries


yards, Heavy (SHI), Hyundai


Heavy Industries (HHI) and Daewoo Shipbuilding and Marine Engineering (DSME) are all attempting to diversify their workload by looking to the offshore sector for orders. The LNG shipping sector remains the one bright spot in an otherwise difficult market.


The Naval Architect October 2012


Samsung


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