S.Korea Shipbuilder STX (SEO:067250) Expects More Offshore Orders

Seoul, Sep 16, 2009 AEST (ABN Newswire) - STX Offshore & Shipbuilding (SEO:067250), the world's No.4 shipbuilder, is targeting a record US$2 billion in new orders for offshore vessels and plants this year.

The South Korean company aimed to maintain or raise the target for offshore orders next year and expects to win orders from oil and gas projects in Brazil, Russia and Africa as the company sees a faster recovery than the commercial shipbuilding business in 2010, because of growing demand for energy development.

South Korea's shipbuilding industry is experiencing extreme difficulties in receiving orders. According to an international shipbuilding market research institute, merely 32 shipbuilding orders have been newly placed worldwide during August.

But STX said it is getting more inquiries compared with late last year or early this year. The shipbuilder is also competing with domestic rivals Hyundai Heavy Industries (SEO:009540), Daewoo Shipbuilding & Marine Engineering (SEO:042660) and Samsung Heavy Industries (SEO:010140), as well as emerging Chinese rivals.

STX can enjoy a technological lead in offshore business for up to 10-15 years, despite China is expected to grow quickly, an executive of the company said.