Samsung Heavy bags 420 bln-won deal for 2 LNG carriers

Samsung Heavy Industries Co., a major South Korean shipyard, said Friday it has secured a 420 billion-won ($380 million) deal to build two LNG carriers, marking the first contract in almost one year.

The deal with a European customer came as local shipyards are suffering from a sharp decline in new orders amid a protracted industrywide slump.

Samsung Heavy is also set to win more deals valued at a combined 3 trillion won, including from a contract to build offshore facilities.

Samsung Heavy is targeting $5.3 billion worth of orders for the year, and has met 7.2 percent of its annual order target.

South Korean shipbuilders have been under severe financial strain since the 2008 global economic crisis, which sent new orders tumbling amid a glut of vessels and tougher competition from Chinese rivals.

The country's top three shipyards -- Hyundai Heavy Industries, Samsung Heavy and Daewoo Shipbuilding & Marine Engineering Co. -- suffered a combined operating loss of 8.5 trillion won last year.

The loss was due largely to increased costs stemming from a delay in the construction of offshore facilities and an industrywide slump, with Daewoo Shipbuilding alone posting a 5.5 trillion-won loss.

The shipbuilders have recently drawn up sweeping self-rescue programs worth 10.35 trillion won in desperate bids to overcome the protracted slump and mounting losses. (Yonhap)