Japanese shipbuilder Kawasaki to construct LNG tankers in China

Japanese shipbuilder Kawasaki Heavy Industries plans to construct gas carriers abroad as it strives to lower costs and take market share from Korean rivals.

At present currency levels, the firm's Chinese ventures are more cost competitive than Korean shipyards, said Akio Murakami, head of Kawasaki Heavy's shipbuilding and offshore division.

"Our Chinese venture, Nacks, has built a variety of vessels so far, and LNG and LPG carriers are the only area that has yet to be handled," Murakami said, referring to liquefied natural gas and petroleum gas. "Once we get the first contract and deliver a good vessel, many orders will follow."

Kawasaki Heavy, based in the western port city of Kobe, estimates costs at its Chinese facilities are as much as 20 per cent lower than at Korean yards, Murakami said.

The company gained a foothold in China in 1995 by forming a venture with China Ocean Shipping Group in Nantong on the outskirts of Shanghai.

While the venture constructs large-sized bulkers and very large crude carriers, the firm builds liquefied natural gas carriers only at its yard in Sakaide on the Japanese island of Shikoku.