HD Hyundai Marine Solutions has secured its first-ever Floating Storage Unit for Liquefied Natural Gas (LNG-FSU) conversion project, marking a significant milestone since its establishment in 2016. The company announced on August 11 that it recently signed a $30 million (approximately 41 billion won) contract with a European shipping company to convert an aging LNG carrier into an offshore LNG terminal.

The vessel to be converted is a 138,000㎥ LNG carrier built in Spain in 2004. The conversion project, which involves transforming the carrier into a floating storage unit, is expected to be completed in the first half of next year. Once converted, the LNG-FSU will be installed in Central America to supply LNG to nearby thermal power plants.

“This is one of the most challenging projects, requiring a high level of technical expertise and know-how,” stated a representative from HD Hyundai Marine Solutions. The company will handle the entire conversion process, including design, procurement, manufacturing, transportation, installation, and commissioning.

HD Hyundai Marine Solutions, a subsidiary of HD Hyundai Heavy Industries, has been actively pursuing LNG carrier conversions as a future growth driver. The company views the eco-friendly ship conversion market as a significant opportunity, especially given the increasing global emphasis on reducing greenhouse gas emissions and adopting cleaner energy sources.

LNG, or Liquefied Natural Gas, is natural gas that has been cooled to a liquid state for storage and transportation. It is considered a cleaner alternative to other fossil fuels, reducing greenhouse gas emissions when used for power generation and heating. The conversion of existing vessels to eco-friendly roles, such as Floating Storage Units (FSUs), is part of a broader trend in the shipping industry to reduce environmental impact.

FSUs are vessels that store LNG offshore and can transfer it to onshore facilities. This is particularly crucial for regions without extensive onshore LNG infrastructure. The converted LNG-FSU will play a vital role in ensuring a stable supply of LNG to thermal power plants in Central America, enhancing energy security and supporting cleaner energy initiatives in the region.

HD Hyundai Marine Solutions’ parent company, HD Hyundai Heavy Industries, is renowned for its expertise in shipbuilding, offshore engineering, and marine services. The spin-off of HD Hyundai Marine Solutions was aimed at focusing on specialized marine solutions, including ship maintenance, repair, and eco-friendly conversions.

The global shipping industry is under increasing pressure to reduce its environmental footprint, driven by international regulations such as those from the International Maritime Organization (IMO). These regulations mandate reductions in sulfur emissions and encourage the adoption of cleaner technologies, driving demand for eco-friendly ship conversions.

“We plan to expand our market share in the eco-friendly ship conversion market,” added the HD Hyundai Marine Solutions representative. The company is positioning itself to capture a significant portion of the market by offering advanced, eco-friendly conversion services that meet the needs of a changing industry.

Source: Businesskorea