Wärtsilä and RSHI Group sign licence agreement for manufacturing low-speed marine engines in China

Wärtsilä Corporation, Trade press release, 20 March 2008 at 11:00 UTC+2

Wärtsilä and Jiangsu Rongsheng Heavy Industries Group Co Ltd (RSHI) have jointly signed a licence agreement for the manufacture and sale of Wärtsilä low-speed marine diesel engines by RSHI in China.

RSHI plans to build a new factory for the manufacture of low-speed engines in Hefei, Anhui Province, China. The factory will have a targeted annual production capacity of engines aggregating five million brake horsepower (3600 MW).

This licence agreement with RSHI will increase the manufacturing capacity for Wärtsilä low-speed marine engines in China to meet the rapidly growing demands of the Chinese shipbuilding industry.

The latest technology of low speed engines

The agreement grants RSHI the right to manufacture certain types of Wärtsilä modern low-speed engine types between 48 and 96 cm bore size at its works, Hefei Rong An Power Machinery Co Ltd in Hefei, Anhui. The first delivery of a Wärtsilä engine is scheduled by the end of 2009.

“The licence agreement with Wärtsilä is an important milestone for the expansion of RSHI into the marine equipment business. This agreement will enable RSHI to produce today’s most advanced low-speed diesel engines for its own shipyard as well as for external customers, securing RSHI’s future leading role in the Chinese ship and engine building industries”, said Mr Chen Qiang, President and Vice Chairman of the Board of RSHI.

“RSHI is one of the most rapidly expanding shipyard conglomerates in China. It is a pleasure to work with RSHI on the new engine factory, which will fully start with the production of Wärtsilä common-rail low-speed engines. We look forward to a long-lasting fruitful partnership,” said Mr Martin Wernli, President of Wärtsilä in Switzerland.

This licence agreement provides RSHI with the latest technology for low-speed diesel engines including the most modern electronically-controlled common-rail technology. Support for the manufacture of Wärtsilä low-speed engines will be provided by Wärtsilä’s Switzerland company which is the group’s centre of excellence for the design, development, research, marketing, licensing, servicing and support of Wärtsilä low-speed engines. Wärtsilä will also assist RSHI in setting up the new engine factory.

About RHSI

RSHI is a large and highly integrated heavy industries group whose major business covers shipbuilding, ship repairing, steel structures and engine manufacture. The annual sales of RSHI are forecast to reach more than US$ 6 billion after completion of its current business development projects.

The investment in the new engine factory in Hefei requires an approval from the NDRC (National Development and Reformation Committee of the People's Republic of China) which is currently in progress. The factory will primarily serve the new shipyard of RSHI which is being developed on Changqingsha Island in Rugao City near Nantong, China. The shipyard covers an area of about four square kilometres with a 3.7 kilometre water frontage. Equipped with two large, building drydocks, the yard is being set up to build a wide variety of ship types, including bulk carriers of panamax size and larger, tankers from Aframax to VLCC sizes, LPG and LNG carriers, and containerships from 4250 TEU to 9700 TEU. RSHI plans to deliver some forty vessels a year, totalling about five million tonnes deadweight.

Next to the shipyard, RSHI is also establishing an offshore yard covering an area of about 1.7 square kilometres with one large, building drydock for constructing FPSO (floating production, storage and offloading) vessels and other offshore projects.


Media contacts:

Martin Wernli
Wärtsilä Switzerland Ltd
Direct tel: +41 52 262 2686
e-mail: martin.wernli@wartsila.com

David Hui Deng
Hefei Rong An Power Machinery Co Ltd
Direct tel: +86 551 3675899 (after 1 April 2008)
e-mail: deng.david@ronganpower.com

Marit Holmlund-Sund
Public Relations Manager
Wärtsilä Corporation
Direct tel: +358 10 709 1439
Direct fax: +358 10 709 1425
e-mail: marit.holmlund-sund@wartsila.com
Internet: www.wartsila.com




About Wärtsilä Corporation:

Wärtsilä enhances the business of its customers by providing them with complete lifecycle power solutions. When creating better and environmentally compatible technologies, Wärtsilä focuses on the marine and energy markets with products and solutions as well as services. Through innovative products and services, Wärtsilä sets out to be the most valued business partner of all its customers. This is achieved by the dedication of more than 16,000 professionals manning 150 Wärtsilä locations in 70 countries around the world. Wärtsilä is listed on The Nordic Exchange in Helsinki, Finland.