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Tuesday, December 10th, 2019

S. Korean Government to Promote LNG-fueled Ship Development and Employment

by November 24, 2016 General


According to the International Maritime Organization, the content of sulfur oxide in fuel oil for ships has to be 0.5% or less from 2020 onwards. At present, the maximum allowable content is 3.5%. Under the circumstances, European countries, the United States and Singapore are bringing in an increasing number of LNG-fueled ships and launching a series of LNG bunkering projects.

Until March this year, 77 LNG-fueled ships were employed, 86% in Europe. 34% of the ships are car ferries and two of them are container carriers, one of which is the world’s first LNG-fueled container carrier with a capacity of 3,100 TEU American shipping company TOTE put into operation in April last year. At present, 85 LNG-fueled ships are being built, including 18 container carriers and 13 car ferries. 72% and 25% of them are scheduled to be delivered to Europe and the United States, respectively. Singapore is providing a subsidy of up to two million Singapore dollars per ship in order to promote the adoption of LNG-fueled ships.

When it comes to LNG bunkering, global hub ports are working on bunkering infrastructure to take the lead in the fledgling market. At present, LNG bunkering in Europe is available at 13 ports such as Rotterdam and Zeebrugge. The EU is planning to increase the number to 139 by 2025. In Asia, Singapore and Japan are leading international networking and infrastructure construction for LNG bunkering.

South Korea currently has only one registered LNG-fueled ship, the 260-ton Econuri of the Incheon Port Authority put into service three years ago. Meanwhile, South Korean shipbuilders are leading the building of LNG-ready ships and bunkering ships. For example, Hyundai Samho Heavy Industries recently signed 17 LNG-ready container carrier building contracts from UASC. Hanjin and STX are working on LNG bunkering ships, too.

In the maritime transport industry, the South Korean government is planning to assist in the introduction of LNG-fueled ships in various ways such as pilot projects, port charges reduction, tax incentives and multiple government-run funds. The government is going to help shipbuilders enhance their capabilities to build LNG-fueled ships as well by means of national R&D projects, technical standardization, engineering training, performance evaluation system establishment, etc.

In the port sector, the government is to focus on infrastructure expansion in order to facilitate the use of South Korean ports by LNG-fueled ships. It is going to provide an LNG bunkering service by making use of existing facilities before setting up new bunkering facilities at the ports located in Busan and Ulsan. It is also planning on closer cooperation with the IMO and major ports such as Singapore and Rotterdam.
Source: Business Korea