Daewoo helping modernize Russia's shipbuilding industry

 and is also pushing to take part in resources development in the country.

The meeting led to an agreement to establish a relationship of long-term business collaboration. The Russian prime minister also promised his support if the firm is interested in taking part in a natural resource development project in his country. 

In March, DSME formed an agreement with Russian’s United Shipbuilding Corp. to collaborate in modernizing the Zvezda shipyard near Vladivostok.

United Shipbuilding Corp. was founded in April 2008 by merging 22 shipyards and nine research organizations under the presidential decree for developing the shipbuilding industry issued by Putin in 2007. The company is currently 100 percent owned by the Russian government. 

The Zvezda shipyard was a military shipyard under the communist regime, but due to its small size and aging facilities, its use for modern shipbuilding has been limited.

As such, DSME plans to expand the shipyard by 1 square kilometer and install up-to-date shipbuilding facilities including a dry dock and goliath crane.

Following completion, whch is scheduled for 2012, the Zvezda shipyard will become Russia’s largest shipyard, capable of building merchant vessels, liquefied natural gas carriers and marine industrial plants, the company said. 

“This modernization project will allow the production of marine equipment needed for developing the energy resources found in eastern Russia,” DSME said.

“The project will also have the effect of stimulating the economy of the region, and allow the company to secure a stable source of orders.”

The company said that the Zvezda shipyard project is an example of bypassing industrial protection policies, and that it also represents a step forward for wining future contracts for vessels and facilities required in energy development such as LNG and oil carriers and floating production units.

“With the modernization project for Zvezda shipyard, DSME became a key foreign-partner in Russia’s program for modernizing its shipbuilding industry,” Nam said in a statement.

“The company will also take an active part in natural resource development projects in Russia.”

For Korea, DSME’s advances in Russia mark a significant development for the Lee Myung-bak administration that places much importance on overseas resource development projects.

In 2008, Lee held a summit with President Dmitry Medvedev and agreed to work on joint projects including a pipeline to pump Russian gas via North Korea, and the linking of the Russian and Korean rail networks.

Lee is again visiting Russia for meetings with the Russian president and prime minister to further the results achieved during his last visit.

Among other issues, putting the previously agreed upon projects into practice will be a key agenda for Lee’s latest meeting with the Russian leaders. 

While the company has been expanding into other areas, through subsidiaries such as DeWind Corp., which specializes in wind power generation equipment, and the construction firm DSME Construction Co., its main source of income remains the business of building ships.

Last year, 62.8 percent of its 12.4 trillion won ($10.6 billion) in revenues was generated from the shipbuilding business.

Since its foundation in 1973, DSME has built up a reputation of quality and an technological edge that allowed it to become the world’s third largest shipbuilder.

Using its technological advantage, the company has been pioneering in developing new types of ships such as a wind turbine installation vessel, the contract for which was awarded late last year. 

According to the company, the contract calls for the world’s first wind turbine installation vessel designed as a platform.

The vessel will be capable of carrying four 120 meter long wind turbines with a wing span of 60 meters.

Once at the installation location, the ship will fix itself in position using four jack-up legs and, using a large onboard crane, install all four of the turbines in 12 days, the company said.