Changing Small and Medium-Sized Ships to LPG Fuel... Busan City Takes First Step in Nationwide Commercialization and Demonstration Project

Total Project Cost of 14.9 Billion KRW Invested from 2021 to 2022

Pioneering the Eco-Friendly Ship Market, Mandating Public Ships

Plan for the construction of hybrid electric propulsion ships with engine generators for small and medium-sized vessels.

[Asia Economy Yeongnam Reporting Headquarters Reporter Kim Yong-woo] Busan City is taking the first step in the country's first project to convert fuel for small and medium-sized vessels to LPG.

On the 28th, Busan City announced that it will actively promote the "Commercialization Project of LPG Propulsion System for Small and Medium-Sized Vessels" for the demonstration of LPG-fueled vessels.

The total project cost is 14.9 billion KRW (national funds 9 billion, city funds 3.8 billion, private investment 2.1 billion) and will be carried out over two years from this year to 2022.

Since last year, the IMO (International Maritime Organization) has significantly tightened the sulfur content in ship fuel oil from 3.5% to 0.5%, and domestically, the "Eco-friendly Ship Act" has been enforced, requiring public vessels to mandatorily switch to eco-friendly ships such as LNG (liquefied natural gas) or LPG (liquefied petroleum gas).

Accordingly, the Ministry of SMEs and Startups and Busan City have formed a consortium of 10 special zone operators including HaeMin Heavy Industries Co., Ltd., KTE Co., Ltd., Korea R&D Co., Ltd., Revensi Co., Ltd., Answer Co., Ltd., Busan Energy, Korea Maritime and Ocean University, Small and Medium Shipbuilding Research Institute, Korean Register, and Busan Technopark to promote the commercialization of eco-friendly LPG propulsion systems for small and medium-sized vessels starting this year.

Previously, due to the absence of related domestic laws and standards, LPG-fueled vessels could not be constructed. Busan City plans to establish guidelines for LPG propulsion vessels through the LPG-fueled vessel demonstration project and propose amendments to related laws to the Ministry of Oceans and Fisheries.

By commercializing LPG-fueled vessels for the first time nationwide in Busan, the city plans to foster the eco-friendly ship industry and drive regional economic revitalization.

Kim Yoon-il, Director of the Job and Economy Office of Busan City, said, "Through the commercialization of LPG propulsion systems for small and medium-sized vessels, we will respond to domestic and international environmental regulations, foster new eco-friendly ship industries, and contribute to the revitalization of the Busan regional economy by creating new jobs."