Hanwha Ocean (formerly Daewoo Shipbuilding & Marine) announced on Nov. 14 that it has signed a contract for the construction of four 93,000-cubic-meter Very Large Liquid Ammonia Carriers (VLACs) with the Greek shipping company Naftomar Shipping and Trading Co Ltd. with a total order value of KRW 656.2 billion (about $496 million) and a single-vessel cost of about $124. The new vessels will be built by Hanwha Ocean’s shipyard in Geoje on the south coast and are scheduled to be delivered by July 2027.
Each VLAC can carry 93,000-cubic meters of ammonia, is the largest of its kind in the world so far.The series of vessels will feature a variety of Hanwha Ocean’s environmentally friendly technologies, including the Shaft Generator Motor System (SGM) and Hanwha Smart Ship Solution& Service (HS4), and can be converted to ammonia-fueled power vessels in the future according to the needs of the shipowner.
Naftomar Shipping and Trading is a shipping company focused on transporting liquefied petroleum gas (LPG) and ammonia worldwide. With a view to accelerating the energy transition and decarbonization, Naftoma has recently been aggressively expanding its fleet with a focus on VLGCs. The company decided to formally order these VLACs based on its trust in Hanwha Ocean’s shipbuilding technology and its confidence in the future potential of the ammonia market.
A Hanwha Ocean official said, “This order reaffirms Hanwha Ocean’s environmentally friendly ship technology, and we will continue to build ships of the highest quality, leading the way in eco-friendly and digital fields.”
Ammonia is understood to be an eco-friendly fuel that does not emit any carbon dioxide when burned, and is therefore attracting attention as a representative fuel that will lead to a zero-carbon era in the future. Also, ammonia can be converted to hydrogen through a simple process, making it by far the most economical means of transporting hydrogen.
In recent years, Hanwha Ocean has been committed to the development of zero-carbon shipbuilding technologies, and its 86,000 m3 liquid ammonia carrier was granted Approval-in-Principle (AiP) by Bureau Veritas (BV) and Lloyd’s Register (LR) in September and October 2022, respectively. Hanwha Ocean is also focusing on developing alternative fuels and environmentally friendly technologies to lead the era of zero-carbon ships. The company plans to gradually reduce greenhouse gas emissions and eventually commercialize zero-carbon ships powered by ammonia fuel, hydrogen fuel, and hydrogen fuel cell power.
Previously, Hanwha Ocean announced that it would transform itself into a “global marine solution provider” and lead a paradigm shift in the future of the maritime industry. Hanwha Ocean has set a goal of realizing KRW 30 trillion (approx. US$22.3 billion) in revenue by 2040, with an operating profit of more than KRW 5 trillion.
Meanwhile, the company announced a capital increase of KRW 2 trillion (approx. US$ 1.5 billion) to push forward the expansion of overseas offshore defense markets, as well as significant investments in environmentally friendly propulsion systems and solutions, and “Class 4” fully automated navigational smart ships. Of this, KRW 600 billion is for the development of environmentally friendly propulsion systems using ammonia, methanol and hydrogen, and related transportation vessels to meet global demand for environmentally friendly products and technologies. Hanwha Ocean has set an operational goal of realizing Level 4 smart ship navigation technology by 2030.