High Royalties Erode Shipbuilders’ Earnings

South Korean shipbuilders are paying large royalties on a core foreign technology for manufacturing liquefied natural gas (LNG) carriers, causing a big reduction in their earnings, industry sources said Friday.

To build LNG carriers, most South Korean and foreign shipbuilders currently use a membrane containment system developed by Gaz Transport & Technigaz of France, a key technology for freezing and storing gas in tanks for transport.