Gyeongnam Ammonia Fuel-Powered Ship Becomes a 'Regulatory Free Zone'

Starting this September, a 4-year maritime demonstration special case with a total investment of 30 billion KRW

Ammonia Co-fuel Propulsion System Ship.

[Asia Economy Yeongnam Reporting Headquarters Reporter Lee Seryeong] A ship powered by a mixed ammonia fuel propulsion system in Gyeongsangnam-do has been finally selected as a Regulatory Free Zone.

According to Gyeongnam Province on the 4th, the 7th Regulatory Free Zone Committee, chaired by Prime Minister Han Duck-soo, was held on the same day and the selection was decided.

The Regulatory Free Zone designated by the Ministry of SMEs and Startups grants special exemptions allowing technologies that are impossible to produce or demonstrate due to various regulations to be tested, demonstrated, and developed without restrictions within the designated zone.

Gyeongnam Province applied for the zone review to prepare for the activation of the low- and zero-carbon eco-friendly fuel propulsion ship market due to strengthened marine environmental regulations, and especially to accelerate the localization of ammonia propulsion ship-related equipment, which is attracting attention as the next-generation ship fuel.

The designated special zone area covers 14.07㎢, including Okpo National Industrial Complex in Geoje City and maritime jurisdiction areas, with a total investment of 30 billion KRW over four years from September this year to August 2026, including 15.75 billion KRW in national funds, 10.35 billion KRW in provincial funds, and 3.9 billion KRW from the private sector.

The main projects include ▲development of ammonia fuel supply system operation technology ▲maritime demonstration of ammonia engines or exhaust gas treatment systems ▲construction of a 500-ton class ammonia fuel propulsion demonstration ship, with 15 companies and institutions such as Gyeongnam Technopark, STX Engine, and Sunbo Industry participating as project operators.

According to the province, with this Regulatory Free Zone designation, project operators can develop supply systems and equipment without legal restrictions and secure maritime demonstration records (track records) essential for ship installation.

The domestic shipbuilding industry expects annual sales of 125.1 billion KRW after 2025 through ammonia equipment development and maritime demonstration, and anticipates annual sales exceeding 898.6 billion KRW from 2030, the market maturity phase.

Ryu Myung-hyun, Director of the Industry and Trade Bureau, said, “Currently, domestic shipyards have strengths in eco-friendly liquefied natural gas (LNG) ships and receive many orders, and although more than 90% of core equipment is developed domestically, only about 20-30% is installed due to the lack of maritime demonstration records.”

He added, “This Regulatory Free Zone designation will provide domestic shipyards and equipment companies with opportunities for maritime demonstration, creating a chance to proactively secure demonstration records. We will do our best to enable the domestic shipbuilding industry to capture the early ammonia ship market and maintain the world’s number one shipbuilding powerhouse gap.”

This content was produced with the assistance of AI translation services.