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Hyundai Near Deal With Iran for 10 Ships

Under the expected contract, valued at $650 million, with the Islamic Republic of Iran Shipping Lines, Hyundai will build four 14,400 TEU container ships and six 50,000 DWT product tankers
Hyundai Heavy Industries Co. is the world’s largest shipbuilding company headquartered in Ulsan, South Korea.Hyundai Heavy Industries Co. is the world’s largest shipbuilding company headquartered in Ulsan, South Korea.

The world's largest shipbuilding company Hyundai Heavy Industries Co., looks set to clinch a deal with Iran to supply 10 ships.

Under the expected contract, valued at $650 million, with the Islamic Republic of Iran Shipping Lines, Hyundai will build four 14,400 TEU container ships and six 50,000 DWT product tankers, Yonhap news agency reported citing TradeWins, a global shipping news service.

The ships will reportedly be delivered starting in the third quarter of 2018.

If signed, the contract will be Iran's first deal with a foreign shipbuilder since the lifting of nuclear sanctions.

Iran is seeking a series of ship-related contracts via the IRISL to handle increasing trade cargo.

Hyundai officials were cautious about the issue.

"(We) are in consultations (with the Iranian side on the possible contract) but it's not decided yet," a company official said.

The Korea Times reported in May that the second largest shipbuilder in the world and one of the "Big Three" shipbuilders of South Korea, Daewoo Shipbuilding & Marine Engineering, signed a memorandum of understanding with the Iranian government to run Iran Shipbuilding & Offshore Industries Complex.

Under the agreement, DSME will also transfer manufacturing technology to the Iranian shipbuilder, the report added.

Iran has been seeking to cooperate with South Korean shipbuilders to modernize its aging dockyards. It has been an important task for the country, which holds the world's largest natural gas reserves and the fourth-largest crude oil reserves, to help its shipbuilding industry to build oil tankers and offshore plants.

According to DSME officials, the Industrial Development and Renovation Organization of Iran, the state-run organization in charge of the nation's strategic industries such as automobiles and shipbuilding, is seeking to form a partnership with the Korean shipbuilder.

Among others, IDRO wants to acquire advanced technology and dockyard management knowhow from DSME to transform Iran into a shipbuilding industry hub in the Middle East. The organization also requested DSME to invest in Iran to manufacture equipment and intermediary materials.

As of October 2016, Islamic Republic of Iran Shipping Lines is reported as the 19th largest in Clarkson Research’s list of top operator-owned container shipping fleets and 21st largest by TEU capacity in Alphaliner’s Top 100 list.

 

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