ADSB sets sail in South Korea

Growing ties to South Korea extend to vessels on the high seas as Abu Dhabi Ship Building signs a co-operation agreement with Korean shipbuilders.

Abu Dhabi, UAE - December 14, 2008 -  Workers work on the bow of a military ship at ADSB. (Nicole Hill / The National) *** Local Caption ***  NH Ship01.jpgbz18de-adsbnew.jpg
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The UAE's growing ties with South Korea have been extended to vessels on the high seas as Abu Dhabi Ship Building (ADSB) signed a co-operation agreement with Korean shipbuilders. The Musaffah-based company said yesterday it would work with STX Offshore and Shipbuilding, the world's fourth-largest shipbuilder, and the nine-member Korea Shipbuilders' Association to identify areas of commercial collaboration.

The partnership could initially focus on the design, integration and manufacture of workboats and offshore-support vessels, an ADSB official said. It is the second alliance between Korean and local firms since Abu Dhabi awarded a US$20.2 billion (Dh74.19bn) contract to build four nuclear reactors to Korea Electric Power Corporation last month. That deal included broad co-operation agreements between industry and academic institutions in the two countries.

On Tuesday, Advanced Technology Investment Company (ATIC) of Abu Dhabi signed a collaboration accord with the Korea Semiconductor Industry Association. Partnerships in other industries could follow, said Chae Kyu-nam, the South Korean commercial attache to the UAE who is based in Abu Dhabi. "For now it covers two industrial sectors, but later on the fields can be expanded." Shipbuilding was a logical area of collaboration since Korea is the world's largest shipbuilding nation and ADSB is the largest builder of naval craft in the Gulf, said Bill Saltzer, the chief executive of ADSB, which also repairs and retrofits commercial vessels.

The shipbuilding agreement covers three areas. First, the three parties will identify areas to jointly market vessels that Korean firms have designed. This could also include manufacturing the vessels in Abu Dhabi, as well as in South Korea, he said. The second area is in the integration of various shipboard technologies including propulsion, navigation and communications. "We are talking about complex vessels in both the military and civil side, with many types of systems installed that may have to be integrated," Mr Saltzer said. In this realm, ADSB may also bring in its subsidiary, Abu Dhabi Systems Integration, to work with the Koreans, he said, adding that systems integration was an under-served aspect of the shipbuilding business.

Finally, the alliance covers the design of new vessels. ADSB's in-house capabilities include "production design" - when builders take a design blueprint and work out the steps needed to build it - but it has wanted to expand that to the actual design stage, Mr Saltzer said. "We have been here for 15 years and we are looking at a logical path towards ship design capabilities." ADSB plans to form a steering committee and working groups with the Korean entities within weeks. One area that the groups will not explore is the local manufacture of oil tankers - a core competence of Korean shipbuilders - because it does not fit with ADSB's expertise and its Musaffah yard is not big enough, Mr Saltzer said.

ADSB's largest project to date is its Baynunah corvette programme, in which it will deliver six 72-metre warships to the Navy at a cost of more than $1bn. The first corvette, which was built for ADSB by CMN, a French shipbuilder, is in builder's trials, while the first corvette being built at ADSB's Musaffah shipyard will take to the water this summer and spend several months in sea trials. Last summer, the shipbuilder formed another joint venture when it linked up with BVT Surface Fleet, a UK naval group, to create Gulf Logistics and Naval Support to provide maritime maintenance support. Potential customers for the new company include navies, coast guards, marine police, homeland security agencies and special forces in the GCC.