KSOE poised to hit $14.9 billion order target earlier than expected

The latest plethora of deals scored by South Korea’s largest shipbuilder has enabled Korea Shipbuilding & Offshore Engineering (KSOE), a holding company of Hyundai Heavy Industries Group, to hit 94 percent of its $14.9 billion target for this year.

The company announced several deals late last week for a total of 11 vessels, pushing the company’s orderbook to 159 ships worth a total of $ 14 billion, according to Business Korea.

These included a deal between Maersk and KSOE’s Hyundai Mipo Dockyard for the construction of a feeder vessel that would run on methanol. The carbon-neutral liner vessel is expected to be launched in 2023, seven years ahead of the company’s initial 2030-ambition.

With all of these contracts in the bag, the shipbuilder is likely to exceed its plans for this year as the shipbuilding sector rebounds from the 2020 lows driven by COVID-19 impact on investments in new ships.

Meanwhile, its plans to acquire shares in the compatriot Daewoo Shipbuilding and Marine Engineering (DSME) have been pushed back again amid regulatory delays. The new date has been set for September 30.

The rebound in the shipbuilding industry has pushed order intake in South Korea by sevenfold in the first half of this year when compared to the previous year, Yonhap reported citing data from Clarkson Research Service.

This equals 10.47 million compensated gross tons (CGTs), up from 1.35 million CGTs ordered in the same period of 2020. These included 6 LNG carriers, 42 oil tankers, 52 LPG carriers, and 81 containerships.

Chinese shipbuilders obtained 10.59 million CGTs in new orders during the same period,  just 120,000 CGTs more than their South Korean rivals, according to Clarksons.