J Ocean Heavy Industries, which is in the process of acquiring the Gunsan shipyard, has secured new orders for a total of six tankers.
The company said on the 21st that it signed letters of intent with an Oceania-based shipowner to build two 157,000-ton crude oil carriers and four 114,000-ton crude oil and petrochemical product carriers. The deal follows letters of intent signed in late June for four 114,000-ton crude oil and petrochemical product carriers, coming about three months later. That brings J Ocean's planned construction pipeline to 10 vessels.
The company said that with active backing from Chairman Cha Jung-hoon, who led the acquisition of the Gunsan shipyard, the yard is moving toward normal operations and inquiries about additional orders from overseas shipowners are arriving one after another. It added that the shipyard's short delivery times have also worked as a competitive advantage in winning orders. Because the Gunsan shipyard currently has no backlog of completed-vessel orders, shipowners can take delivery of ships when they want them.
Both vessel designs covered by the latest letters of intent are next-generation hull forms developed in-house by affiliate HJ Shipbuilding & Construction (097230). The 114,000-ton crude oil and petrochemical product carrier in particular is designed to meet International Maritime Organization environmental rules while also being able to carry crude oil and petroleum products separately. That allows shipping companies to maximize the efficiency and profitability of their tankers depending on market demand.
J Ocean Heavy Industries plans to continue pursuing refund guarantees, an overhaul of its yard and facilities, and an expansion of its workforce. "We will do everything we can to make the Gunsan shipyard a catalyst for reviving the regional economy," a company official said.
In June, J Ocean Heavy Industries signed an asset transfer and business cooperation agreement to buy all related tangible assets of HD Hyundai Heavy Industries' (329180) Gunsan shipyard, including its plant, dormitory and technical training center, for 780 billion won. The transfer of ownership is scheduled for Dec. 31.
HD Hyundai Heavy Industries' Gunsan shipyard halted operations in 2017 amid an industry downturn and a collapse in orders, then resumed block production in 2023, but it has not been equipped to build a complete vessel from start to finish. J Ocean Heavy Industries plans to rework the yard's layout and facilities and to reinforce the infrastructure needed for complete-vessel construction in stages. It aims to begin ship construction processes in phases starting next year, with a first delivery targeted for 2028.
If the Gunsan shipyard resumes shipbuilding, it is likely to create quality jobs and revive the regional economy, particularly in related industries such as equipment, logistics and services. The central government and local authorities are also stepping up support. The budget proposal the government submitted to the National Assembly for next year allocates 5 billion won in new funding to build a 5G private network-based M.AX platform at the Gunsan shipyard to demonstrate artificial intelligence transformation for manufacturers.
