SEOUL, March 25 (Yonhap) — Hyundai Heavy Industries Group said Thursday that it will nurture hydrogen-related business as its new growth engine amid tightened environmental regulations and rising demand for eco-friendly fuels.

Under the plan, the shipbuilding group will establish a new unit that handles the production of hydrogen and the use of it on land and sea by 2030.

Hydrogen is an environmentally friendly alternative to fossil fuels, as vehicles and ships propelled by the resource only create water in the process of generating power.

Offshore projects to produce and transport hydrogen will be sought after by Korea Shipbuilding & Offshore Engineering Co. (KSOE), the group’s subholding company, which has three shipbuilders –Hyundai Heavy Industries Co., Hyundai Mipo Dockyard Co. and Hyundai Samho Heavy Industries Co.

A liquefied petroleum gas (LPG) carrier built by Hyundai Mipo Dock Yard Co. sails on a sea trial, in this photo provided by Korea Shipbuilding & Offshore Engineering Co. on Oct. 16, 2020. (PHOTO NOT FOR SALE) (Yonhap)

KSOE said it will go ahead with a project to produce green hydrogen that refers to hydrogen produced by splitting water by electrolysis, using renewable energy sources such as wind power without emitting carbon dioxide.

The shipbuilding group said it will also speed up the development of hydrogen carriers.

In October, Hyundai Mipo Dockyard Co. won approval for the design of a commercial hydrogen carrier for the first time in the world from KR, a South Korean ship quality assurance and risk management company, and the Liberian International Ship & Corporate Registry (LISCR), the U.S.-based manager of the Liberian Registry.

 KSOE also will develop ships propelled by hydrogen fuel cells.

Under the group’s onshore hydrogen project, Hyundai Oilbank Co., a refining unit of the group, also plans to build about 180 hydrogen stations by 2030 across the country.

Hyundai Electric & Energy Systems Co., a power equipment manufacturer, and other group affiliates will be engaged in various hydrogen-related business.

In a bid to push for environment-friendly business, the group plans to raise 1 trillion won (US$900 million) by listing shares of Hyundai Heavy Industries Co., a shipbuilding unit of KSOE, this year.

In February, Hyundai Heavy Industries Holdings Co. (HHIH), the group’s holding company, said it raised about 800 billion won via a pre-initial public offering of its wholly owned ship repairing unit Hyundai Global Service to garner investment for the hydrogen business.

Earlier this month, HHIH signed an initial deal with Saudi Arabia’s state-run oil firm Saudi Aramco to cooperate on a hydrogen project to produce blue hydrogen.