While shipyards in the Far East and Asia may not be predicting boom times in 2010, the year has started off in a mildly optimistic atmosphere with companies eager to trumpet their first orders.

Significantly though, there is also a swing by some yards in Korea and India toward making inroads into the market for high-end ships traditionally the last bastion of their European competitors. Although yards in the region have previously been regarded as not providing the same technologyenhanced products as those often offered in the West, there is now a growing
emphasis on supplying more complex or luxurious vessels and ships with impressive “green” credentials.

Korea’s Samsung Heavy Industries (SHI) said it recently broke new ground for the shipbuilding industry, claiming to have ended the long-term domination of the cruise ship market by
European shipbuilders.

The company was recently picked to build a cruise ship for Utopia, a U.S.-based cruise owner and operator. The order, worth US$1.1 billion, is believed to represent one of the first moves into the cruise shipbuilding market by a Korean company. The vessel is an apartment-type cruise ship where customers can buy their cabins and is due for delivery in 2013.

The move is regarded as an important milestone within the Korean shipbuilding industry as it reduces its reliance on the traditional bulk ships it offers. It has been estimated that as many as 13 cruise ships worth US$12 billion may be ordered from Korean yards in 2010.

As Kim Jing-wan, vice chairman of SHI, said, “As the Korean shipbuilding industry needs to advance into the cruise ship market if it is going to maintain its number-one position in the global shipbuilding market, Samsung Heavy Industries aims to surprise the world with the exceptional quality of this apartment-type cruise ship, and lay a foundation for new growth of the Korean shipbuilding industry.”

Rival shipbuilder STX Offshore & Shipbuilding of Korea also highlighted its own ambitions to grow its position in the high-end portion of the market. Announcing its first ship contract this year an order for four 57 300 DWT bulk carriers including an option for two additional vessels from Turkish shipper Densa, STX said that it plans to accelerate research and development to “secure competitive ness of futuristic high value-added ship products.”

STX is, like SHI, bullish about the prospect of future cruise-related business, saying that because cruise lines hesitated to place new orders last year, they are expected to resume orders ensuring a “brisk performance” within this sector of the newbuild market.

The company added it believed the shipbuilding industry has been gradually recovering due to an increase in new orders since the end of last year. The message of gradual recovery was also
echoed by Singapore-based yard Keppel FELS Ltd., which recently won a contract with Aramco Overseas Company B.V., a subsidiary of oil and gas producer Saudi Aramco, to build a Super B
Class jackup rig due for delivery in 2010 for deployment in the Middle East.

“This is an encouraging development, signaling that confidence is gradually returning to the industry,” said Wong Kok Seng, executive director of Keppel FELS. In India, Cochin Shipyard said it had delivered another platform supply vessel to M/s NFC Offshore GmbH KG the third delivered to the same owner.

Like several of its Far East/Asian competitors, Cochin also said it is hoping to diversify into the high-end markets. The company reported that it is likely to start construction of such ships by mid-2010 and added that various Indian and foreign owners have shown interest in the high-end ships.

It added that as the offshore industry moves into deeper waters, demand for advanced platform supply ships is expected to rise. SHI has also underlined its “green” ambitions by announcing its intention to  build only eco-friendly ships beginning in 2015. By then, it aims to have designed the “optimal shape” of ships to maximize fuel and energy efficiency with technology, including heat recovery and low-temperature combustion devices.

SHI added that its goal is to build the world’s first eco-friendly ship by developing LNG and hydrogen fuel cells, superconduction electricity-powered motors and cables and carbon dioxide collection technology.


Leave a Reply