South Korea’s Daewoo Shipbuilding & Marine Engineering may establish a new shiprepair yard in South Africa.
The company said no decision on the potential plant has been made, but South African reports said it would be located next to the Richards Bay coal terminal on South Africa’s east coast, Business Day said.
The intention is to service vessels that operate in southern waters, according to South Africa’s department of transport chief George Mahlalela, the Johannesburg-based newspaper said.
A huge price-tag of up to 40bn rand ($6bn) has been reported in South Africa.
Daewoo and the government see potential for a shipyard serving the large volumes of traffic passing through SA’s waters. "The South Koreans want to set up a ship repair yard and are really pushing for these things. They are keen," Mr Mahlalela said.
The shipyard may cost R40bn to build and would form the platform for the company to extend other services in Africa in future. Mr Mahlalela said Daewoo Shipbuilding had identified land owned by Transnet next to the terminal for the development.
Last year Daewoo Shipbuilding bought a 49% stake in President Jacob Zuma ’s nephew Khulubuse Zuma’s Impinda Group for an undisclosed sum. Impinda in partnership with Daewoo planned to ship raw materials such as oil, gas and other raw minerals around Africa.
However, there it is not clear whether Impinda will play any role in the building of the shipyard.
Daewoo, which is the world’s second-biggest shipbuilder, has "done studies", on investing in a shipyard that would start operations offering repair services to vessels operating in the waters along the west and east coast of the continent before possibly diversifying its services, Mr Mahlalela said.
Mr Mahlalela said discussions with Daewoo have included issues such as ship registration and access to land.
"They want access to land, next to a port, and they want us to facilitate things such as registering some of their ships in SA," he said. "They also need agreements with some of our big exporters, such as the mining companies."
Daewoo may be required to register some of its ships carrying coal, iron ore and manganese exports from SA under the South African flag. The state can oblige exporters to divert as much as 30% of exports onto ships registered in SA, Mr Mahlalela said. But it was not practical to expect exporters to be immediately released from existing contracts with shipping companies.