South Korea's Three Major Shipbuilding Giants Fully Enter The Russian Market

Recently, Samsung Heavy Industries and Russia’s Red Star Shipyard (Zvezda) signed an investment letter of intent to form a joint venture company to manage the Arctic shuttle tanker construction project.

This joint venture will provide technical support for the Red Star Shipyard to build Arctic shuttle tankers of different sizes from 42,000 to 120,000 dwt. These shuttle tankers will be used to export oil for Rosneft and other Russian and overseas producers.

At the same time, Zvezda-Hyundai, a joint venture between Red Star Shipyard and Hyundai Sanhu Heavy Industries, recently signed a research and development contract with Lazurit Design Bureau to develop design data for the construction of Aframax tankers using gas fuel engines.

The Red Star Shipyard also reached an agreement with the French engineering company GTT to conduct a technical evaluation on the possibility of the Red Star Shipyard building a membrane system for LNG storage and further obtaining the GTT liquefied gas vessel construction permit. This agreement will conduct a technical evaluation of the Red Star Shipyard in accordance with GTT standards and enable the Red Star Shipyard to master the manufacture of thin-film LNG storage systems.

Red Star Shipyard said that after training relevant employees, Red Star Shipyard will build a scale model of the GTT storage system, and GTT will be able to decide whether to provide professional certification to Red Star Shipyard. The Red Star Shipyard plans to make the construction of the liquefied gas ship one of the first tasks of the production plan.

Daewoo Shipbuilding is the first Korean shipbuilding company to cooperate with Zvezda Shipyard. On November 13, 2013, Russian energy giant Rosneft, shipowner SovComFlot and Gazprombank signed a memorandum of understanding with Daewoo Shipbuilding & Marine.

According to the memorandum of understanding, the two parties agreed to jointly fund the construction of a new shipyard, the Zvezda Shipyard, and establish a Russian-Korea Shipbuilding and Offshore Engineering Equipment Engineering Center in 2016 to jointly build a shipbuilding and marine equipment industry cluster. As part of the agenda of the Russian President’s official visit to South Korea, then South Korean President Park Geun-hye and Russian President Putin signed a memorandum of understanding.