Korean shipbuilding industry is to ink contracts for construction of nine capesize bulkers within two months and seven LNG carriers at the end of next year, backed by a long-term newbuilding charter project conducted by Korean state-owned companies.

A signing ceremony for long-term charter of bituminous coal carriers was held on February 14, which is expected to support for Korean shipbuilders and equipment industry through new orders to be contracted for nine 150,000DWT bulkers worth around KRW 450bn ($400m) in total.

The ceremony for signing contract between five utility companies and four shipping companies was attended by more than 20 executives and officials, including Yoon Sang-Jik, vice-minister of the Ministry of Knowledge Economy, the presidents of five subsidiary utility companies of KEPCO (Korea Electric Power Corporation) and four shipping companies, etc.

Under the terms of the agreement, the shipping companies are to deliver the bituminous coal to utility companies for 18 years and for this, they are planning to place orders at domestic shipyards for nine 150,000DWT bulkers within two months, which will start operation from 2015 to 2018 one by one.

As for charter contracts, three vessels were signed by Hyundai Merchant Marine of Korea, two by STX Pan Ocean, two by SK Shipping and the other two by Hanjin Shipping.  

Shipping companies are to choose shipyards, which is said to take around two months. the Ministry of Knowledge Economy ensured that Korean shipbuilding industry and shipping industry can keep a win-win relationship by building and delivering fuel-efficient vessels with advanced technology of domestic shipyards.

Also, the Ministry of Knowledge Economy of Korea has announced that it will make use of state-owned energy companies ▲to promote a revitalization of the domestic market by placing orders at domestic companies and ▲to encourage domestic shipyards and equipment companies to take part in oil and LNG development projects so that they can grow further in growing offshore plant market.

Particularly, the ministry also mentioned Korea Gas Corporation's seven LNG carriers (worth around $1.4bn) is scheduled to place orders at the end of 2014, which would also aid related local industries by giving further workload.