The South Korean shipbuilding giant Samsung Heavy Industries (SHI) received a court order to pay roughly $290 million to SK Shipping due to defects found in the cargo holds of two liquified natural gas (LNG) carriers.
According to Offshore Energy, Samsung Heavy Industries said that an arbitration tribunal in London ruled during the week of December 12 that SHI must pay $290 million to SHIKC1 Shipholding S.A. and SHIKC2 Shipholding S.A., a pair of special purpose companies controlled by SK Shipping. The decision came after a court determined that the defects found in the cargo holds of the LNG carriers were not properly or punctually repaired.
The 45.9 million liquid-gallon ships were ordered back in 2015. SHI said that construction of the vessels was completed in February and March of 2018. However, a cold spot occurred in the cargo hold of both ships, causing their operations to be paused and repairs to be carried out several times.
In October 2023, a South Korean court ruled that the Korea Gas Corporation was responsible for the ships’ design defects. At the time, KOGAS was ordered to pay SK Shipping $55.8 million in repair costs and $88.7 million in unoperated operation losses.
“If the three-party consultation fails, our company will seek compensation from the arbitration in this case through a compensation lawsuit against Korea Gas Corporation,” SHI said in a statement.
