A consortium led by Chinese state-owned Shanghai Salvage signed a contract with the South Korean government on 4 August to hoist the capsized Sewol ferry.
The contract signing follows two weeks of negotiations, after the consortium was chosen on 15 July as the preferred bidder following an open tender that saw 27 companies submit applications.
Besides offering a competitive price, the consortium also scored high marks for its technical expertise. Shanghai Salvage was also involved in hoisting the Eastern Star, the ferry that capsized in stormy weather in the Yangtze River on 1 June.
Suggestions for the lifting of the hull, a structural analysis of the hull, and the loss prevention methods were all detailed in the tender.
The Sewol capsized during a routine Incheon-Jeju trip on 16 April 2014, leaving 304 of 476 people dead or missing. Nine bodies remain missing.
The salvage works are expected to be daunting because of the vessel size and the rough waters. The ferry remains submerged in the Maenggol Channel, a part of the Yellow Sea notorious for unpredictable and swift currents.
The consortium submitted a bid of KRW85.1 billion (USD73.1 million). Following the negotiations with South Korea’s Ministry of Oceans and Fisheries, it has been agreed that the payment would be made in three phases.
The first payment tranche would be made after loss prevention procedures and the removal of any leaked oil or residue are completed. The second batch of payments would be made after the Sewol has been hoisted and docked at a designated location.
The payments would be completed once the ferry is brought ashore for demolition.
The consortium would be responsible for any accidents that occur during the salvage process and would be liable to pay compensation for any damages that arise as a result.
The ministry said that all equipment to be used in the salvage works are compliant with International Association of Classification Societies’ requirements.
The salvage operation is expected to start in September.