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CSIC sees dual-fuel as big opportunity

By Zhong Nan in Wuhan | China Daily | Updated: 2019-01-29 09:15
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A fishing equipment made by a subsidiary of China Shipbuilding Industry Corp is delivered in Qingdao, Shandong province. [Photo by Zhang Jingang/For China Daily]

China Shipbuilding Industry Corp, or CSIC, the primary contractor for China's naval force, has completed the basic design and related research for a dual-fuel container ship that can carry 20,000 twenty-foot-equivalent-unit containers, said its top executive on Monday.

With a dual-fuel engine, the ship can use liquefied natural gas and regular fuel to convert chemical energy to mechanical energy. Thanks to LNG's cleaner burning properties, dual-fuel powered commercial vessels have become an option for shipping companies to comply with international environmental regulations.

In addition to producing high-end mega container ships, Hu Wenming, CSIC's chairman, said the group will launch a three-year action plan to focus on building high-end ships, offshore engineering products and brand awareness throughout the world, in particular in markets related to the Belt and Road Initiative.

"CSIC will no longer take orders that have no profit or may cause financial loss from the civil ship market and deploy more resources on producing high-end products such as deep-water semi-submersible drilling platforms, intelligent offshore ocean farming facilities, very large crude carriers and vehicle carriers," he said.

The Beijing-headquartered State-owned enterprise saw its sales revenue rise 4.9 percent year-on-year to 315 billion yuan ($46.77 billion) in 2018, while its net profit surged by 33.5 percent to 8.86 billion yuan.

Established in 1999, the company's marine sector covers both naval and merchant ships, and equipment manufacturing. It also designs, develops and manufactures a wide-range of non-marine products.

To better integrate its civilian and military businesses, Hu said the group will accelerate the cultivation and expansion of civil-military integration industry focusing on the strategic direction of national energy security, maritime defense, marine leisure tourism and ecological protection, as well as develop technologies and products in other fields including clean energy, smart ocean network, intelligent equipment, new materials, internet of things and low-altitude navigation.

"If you look at the global market for low-end ships and offshore engineering products, you can see declining signs in these areas everywhere," said Li Bo, a professor of shipbuilding at Shanghai Maritime University.

"Capable shipyards have already shifted a part of their business to maritime economy and other fast-growing businesses such as new materials, mechanical and electrical equipment, because, apart from higher profits, there is also less competition as not many shipbuilders are able to produce these sophisticated products," said Li.

The marine economy now includes sectors such as marine chemistry, biomedicine, ocean power, seawater use, marine tourism, ocean engineering and construction. A large variety of vessels serve these industries and sectors. Li said conventional vessels like bulk ships and ore carriers are no longer the kings of the marine economy transport system.

With a workforce of more than 170,000, CSIC operates more than 50 industrial subsidiaries and 29 research institutes, including Wuchang Shipbuilding Industry Co Ltd, Qingdao Beihai Shipbuilding Heavy Industry Co Ltd and Dalian Shipbuilding Industry Co Ltd. It has exported various types of vessels to more than 70 countries and regions such as Thailand, Malaysia and Norway.

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