Mastek in luck in partner hunt
South Koreans get the green light to construct a new shipyard in China.
Korean ship-design and marine-engineering company Mastek Heavy Industries has found a new partner to establish a shipyard in China. The Busan-based outfit is hooking up with Qingdao Economy Development Investment Corp (QEDIC) to build a huge shipbuilding facility in Qingdao city in China's Shandong province.
Speaking to TradeWinds, Mastek president YH Kim says the new yard will be known as Qingdao Jimo Mastek Shipyard (QJMS) and construction of the plant is scheduled to start in November. "We received the approval from the Chinese government to establish this new yard in July," said Kim. He adds that QEDIC is a government investment company and it will be the major shareholder of the yard, with 51%, while Mastek will own the remaining 49% shares.
Kim estimates that the total cost of building the yard will require $900m and the construction will be carried out in three phases.
"Phase one will cover an area of about 1.6 million squaremetres and will have a dry dock of 530 metres in length and 105 metres wide as well as a 'skid launch' production system," said Kim.
He says the yard will be ready to start building ships from the third quarter of next year. It will kick off production with simple vessels such as bulkers and containerships. "We are targeting bulkers of less than capesize but bigger than panamaxes. We have set our pilot project as bulk carriers because construction of simple vessels will help the company to build up a good team," added Kim.
QJMS is said to be able to deliver its first unit in the first quarter of 2009 and is currently in contact with shipping companies from Europe and Asia.
"Once the foundation of our shipyard is established, we will go for high-value vessels such as tankers," said Kim. However, QJMS is limited to building units of up to aframax size.
Kim says the construction of phase two of the yard will probably take place in 2008. The plan is to build another bigger dry dock while also expanding workshop facilities.
"The third phase will probably take place in 2010 and we are planning to expand the facilities to include the building of offshore vessels," said Kim. "Once phase three is completed, the shipyard should occupy [an area of]some six million square metres."
Kim has been trying to establish a yard in China for the past two years. He initially partnered Beijing-based trading house China National Machinery Import&Export Corp (CMC) to build a new facility in Qingdao but that project was stopped because of a new regulation set by the Chinese government.
The government is putting a cap on the development of yards by restricting new facilities to 100,000-dwt capacity. Anyone planning to build bigger docks has had to seek special permission from Beijing.
By Irene Ang, Singapore
published: 22 September 2006