A general view of the Ulsan Shipyard of Hyundai Heavy Industries. (Photos: HHI)

Hyundai Heavy Industries Holdings Vice Chairman Kwon Oh-kap.

Hyundai Heavy Industries (HHI) has succeeded in landing its first offshore project order in four years.

HHI said on Oct. 9 the company struck a $450 million (510 billion won) order to build a half-submerged floating production system (FPS) with LLOG Exploration, a Huston-based deepwater explorer company.

The “King’s Key Project” calls for installing an FPS unit for crude oil exploration now under way at the Gulf of Mexico, the United States. Work on the FPS will start next August following the completion of its design, which is to take about one year. But HHI’s winning the latest offshore project order is unlikely to have an immediate effect of easing a shortage of work for HHI’s offshore division.

The order is a kind of a sigh of relief for HHI, which is struggling with a shortage of work. The price tag of offshore project orders is higher compared to that of other ships, so shipbuilders rely on the offshore industry business to make up for fixed costs such personnel expenses and production equipment costs. The winning order is expected to serve as an opportunity for labor and management to mend fences after leaving behind the latest fierce conflicts.

“(The latest winning order) cannot have an immediate effect of solving a shortage of work, but we’ve gotten things under control now,” an HHI official said. HHI is aggressively trying to land additional orders, which are essential in normalizing the operation of an offshore plant, he added.

Leading the Global Offshore Industry

The Offshore & Engineering Division of Hyundai Heavy Industries (HHI) is located 5km from the main shipyard of HHI, and operates the world's largest offshore yard covering 292 acres.

HHI's involvement in offshore structures began with a Saudi Arabian order for 89 jackets and deck structures for the Open Sea Tanker Terminal for the Jubail Industrial Harbor Projects in 1976.

Since 1991, Offshore & Engineering Division has become a world leading EPCIC contractor providing integrated services such as Engineering, Procurement, Construction, Transportation, Installation, Offshore Hook-up and Commissioning, and Project Management.

Offshore & Engineering Division has successfully completed more than 170 projects including over 100 EPCIC projects in turn-key basis and has been recognized as one of the most experienced and advanced offshore yards in the world. The range of products and services covers FPSOs, FLNGs, FPUs, semisubmersibles, jack-ups, TLPs, fixed platforms, subsea pipelines, and land-based LNG and processing modules.

Offshore & Engineering Division combines onshore process plant expertise with offshore module fabrication experience to create high-value added service. The division will also continue to develop state-of-the-art technology and provide high quality services for the oil and gas industry.

Offshore & Engineering Division has a dry dock with a capacity of 1 million ton equipped with extra-large gantry cranes, both capable of lifting 1,600 tons in its offshore yard.

The new heavy lift vessel, “HD 10000” with the lifting capacity of 10,000 tons, allows HHI to build bigger blocks in the construction stage and helps HHI accomplish its goals of providing clients with a comprehensive and cost-effective solution that meets their needs.