NYK and Oono Development to collaborate on sustainable ship recycling

In a big step toward advancing decarbonization efforts, Japanese shipping titan NYK and compatriot civil engineering company Oono Development have joined forces through a Memorandum of Understanding (MoU) to commercialize ‘environmentally friendly’ and responsible ship recycling in Japan.

As disclosed, the partnership between NYK and Oono Development will focus on dismantling large ships and offshore structures and recycling them as high-quality steel scrap and other materials.

The ship dismantling work is set to be performed at Japan’s only dry dock that can handle large ocean-going vessels, owned by Oono Development and located in the city of Chita in Japan’s Aichi prefecture. The dry dock is one of the largest in the country, boasting 810 meters in depth, 92 meters in width, and 14.3 meters in height, creating ample space for the dismantling of two large ocean-going vessels simultaneously.

Oono Development, which is engaged in various environment-related businesses, ranging from demolition to waste disposal, will leverage a dry dock method and technology for onshore dismantling and waste treatment with consideration of the environment as well as occupational safety.

The overarching goal will be to promote ‘environmentally responsible and efficient’ recycling and decarbonization of steel resources, according to the companies.

As global decarbonization efforts intensify, the steel industry in general has been transitioning toward the use of electric furnaces and steel scrap. The demand for high-quality steel scrap with low impurity levels, which is difficult to remove from molten steel, has also skyrocketed in value.

Ships—which are composed of vast amounts of steel—represent a valuable source, with a potential to aid the maritime industry’s shift to greener practices.

NYK has emphasized that over 90% of medium and large vessels are recycled for construction materials and other purposes. Thereby, adopting sustainable and ‘safe’ ship dismantling methods with a low impact on the environment could help close the loop in the steel lifecycle.

What is more, regulatory changes and adjustments are right around the corner, further deepening the need for sustainable ship recycling. Back in December 2013, the EU put into effect the EU Ship Recycling Regulation, a dedicated legally binding framework regulating vessel recycling.

The regulation—expanded in December 2023 to include 45 more yards—laid down requirements for the facilities to ensure that ship recycling is performed in a safe and sound fashion, while restricting or prohibiting the installation and use of hazardous materials on vessels.

In addition, from June 2025, the International Maritime Organisation’s (IMO) Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships will be implemented to ensure environmental protection and occupational safety in ship dismantling.

According to NYK, at the present moment, the number of yards worldwide that meet those standards is limited, which is why NYK and Oono Development aim to put Japan and the joint project in Aichi prefecture on the map of ‘efficient’ and ‘danger-free’ dismantling and recycling.

To be precise, in order to ensure an eco-friendly and systematic demolition, with ‘no marine spills of oil or other harmful substances’, Oono Development will reportedly leverage its dry dock land-based demolition and waste disposal method, relying on large, heavy equipment at a 39-hectare demolition site.

As per NYK, the primary reason why the dry dock method will be employed is due to its low environmental impact; namely, this method involves pulling the vessel out of the water first and then performing the demolition in a facility on land, thus avoiding polluting the water or the beach during the process.

A new ‘high-efficiency’ incineration power generator facility will also be constructed on the site to wrap up the treatment of industrial waste. It has been reported that both a mooring and a coastal quay have been installed, enabling on-site vessel mooring and the removal of scrap iron and other valuable materials.

To remind, in July 2023, NYK reported the completion of the dismantling of a heavy-lifter vessel, Kamo, at the PHP ship recycling facility in Bangladesh. Back then, the company had stated that NYK Group was the first Japanese shipping company to complete dismantling at the yard and meet the regulations specified in the Hong Kong Convention.