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South Korea to invest $3.4 billion to support LNG bunkering sector

22 Nov 2018

The South Korea government and its related ministries on Thursday (18 November) at a meeting announced several initiatives to boost the vitality of the local shipbuilding industry partly through the construction of liquefied natural gas (LNG) fuelled vessels and bunkering infrastructure.

It plans to invest KRW 1 trillion (USD $880 million) to expand the supply of eco-friendly vessels and facilities; and contribute KRW 2.8 trillion (USD $2.5 billion) to develop LNG bunkering infrastructure.

The KRW 1 trillion development includes a project starting 2019, to have domestic small and medium-sized shipyards build a total of 140 LNG-fuelled vessels by 2025.

It also includes a move to convert tugboats to use LNG as a marine fuel through the introduction of government subsidies.

Meanwhile, the KRW 2.8 trillion LNG bunkering infrastructure development will be part of a larger scheme to expand use of the product as a fuel by the private sector.

The government notes a total of five LNG related maritime projects, including a LNG loading facility, currently being built in Korea.

It also intends to introduce a non-regulated market for LNG trading by easing regulations, permitting transactions among business operators, and more.

Moving forward, a plan to extend new financial support of KRW 700 billion, and extension of maturity guarantees of KRW 1 trillion for Korea’s domestic small and medium-sized shipyards has been further introduced.

“In particular, the financial support will be provided by large shipbuilders (Hyundai, Samsung, Daewoo), local governments (Busan, Ulsan, Jeonbuk, Jeonnam, and Gyeongnam) and the government,” it says.

“It is of great significance that we overcome the crisis and pursue mutual growth.

“The government is trying to resolve financial difficulties faced by small and mid-sized shipbuilders and equipment manufacturers.”

Representatives from Hyundai Heavy Industries, Samsung Heavy Industries, Daewoo Shipbuilding & Marine Engineering Chosun (Chosun Industrial Cooperative Association, and the Chosun Equipment Cooperative Cooperative), and five local governments (Busan, Ulsan, Jeonbuk, Jeonnam and Gyeongnam) attended the meeting.

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Photo credit: Ministry of Commerce, Industry and Energy
Published: 23 November, 2018

 

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