STX hit by hefty arbitration rulings

STX hit by hefty arbitration rulings

Troubled South Korean yard STX Offshore & Shipbuilding has had to fork out sizeable penalties to overseas owners for late deliveries of ships, with more likely. The yard, which is under court receivership, has paid KRW47.1bn ($40m) so far in penalties meted out by the London Maritime Arbitrators Association (LMAA). Teekay received KRW37.8bn and Sigma Drilling was awarded KRW9.3bn.

Teekay’s case related to STX failing to deliver a series of tankers, while Sigma’s was over a delayed drillship. Teekay is now taking the yard to court for another KRW208.4bn over cancelled options it had with the yard.

A week ago a South Korean court approved a filing by STX Shipbuilding to be put under a court-led restructuring scheme, allowing the yard to stave off liquidation.

In May, STX Shipbuilding filed for receivership, suffering from huge losses. It now has until September 9 to issue a self-rescue plan.

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.

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