LNG

Hanwha Ocean, the South Korean shipbuilding company formerly known as Daewoo Shipbuilding & Marine Engineering, is said to be considering a move into the offshore platforms and drilling sector while continuing to increase its LNG carrier newbuild backlog.

Korean regulatory information shows that Hanwha Ocean has registered two new trademarks, suggesting expansion into the maritime energy drilling sector as the nation’s companies seek more profitability.

The registrations concern “Hanwha Drilling” and “Hanwha shipping”, though the Group has yet to disclose its intentions.

Hanwha Ocean, formerly DSME, was acquired by the Korean conglomerate, the Hanwha Group, in 2022 and was rebranded as Hanwha Ocean in May 2023.

Two Japanese companies have just filed an order for an LNG carrier to be built at Hanwha Ocean’s Geoje Shipyard in South Korea.

Tokyo Gas, the utility company and LNG importer, said its Tokyo LNG Tanker Company concluded a long-term charter contract with Mitsui OSK Lines (MOL) for this newbuild vessel ordered by MOL.  

MOL LNG fleet

MOL has a growing energy shipping business with a fleet including over 150 tankers for oil and other products and about 90 LNG carriers.

Tokyo Gas said that the charter agreement meant that the company had 11 LNG carriers fixed under a long-term charter.

The utility said that the MOL-owned newbuild would have 174,000 cubic metres capacity and be delivered in 2026.

The carrier will have a service speed of 1.5 knots and would be 295 metres in length and a beam of 46.4M.

“The Hanwha Ocean-built vessel will be equipped with the state-of-the-art MAN Energy Solutions engine (ME-GA) with improved fuel consumption efficiency and is expected to significantly reduce greenhouse-gas emissions compared to conventional LNG carriers,” said the utility.

“From 2026, the vessel will be utilised for TG Group’s LNG procurement and LNG trading,” it added.

“With this charter contract, the TG Group will continue to promote stable energy procurement while giving further consideration to the environment amid the changing surroundings of the global LNG market,” it added.

South Korean shipbuilders, the global leaders in the construction of liquefied natural gas carriers, ranked second in 2023 in terms of new global orders for all types of vessels for a third straight year, though increased their share of the LNG newbuilds market.

South Korean shipbuilders are still leading their Chinese counterparts in orders for liquefied natural gas carriers, though China’s yards are well ahead in overall orders for newbuilds even as the shipbuilding market was weaker than in 2022.

Sept 18 (LNGJ) - Hanwha Ocean of South Korea, formerly known as Daewoo Shipbuilding & Marine Engineering, and French classification society Bureau Veritas have started a joint development project (JDP) on the structural assessment of independent LNG fuel tanks for ultra-large ships.

   “The particularity of these independent tanks is that they are not rigidly connected to the hull structure but are instead held by an important number of dedicated supports, which must be designed with consideration of non-linear structural response during operations, including loss of contact and sliding,” said a statement.

The Korean Register, the classification society of the Republic of Korea, has awarded an Approval in Principle (AIP) for an LNG dual-fuel Very Large Gas Carrier (VLGC) jointly developed by KR and South Korean shipbuilder HD Hyundai Heavy Industries.

The award was made at the five-day Gastech energy conference and exhibition in the Asian city state of Singapore.

“Currently, the global maritime industry is grappling with the development of various counter-measures to meet strengthening greenhouse-gas regulations and there is more market interest in eco-friendly ships fueled with LNG in particular,” said KR.

The newly approved LNG dual-fuel VLGC, which has been developed in response to market needs, utilizes both marine gas oil (MGO) and LNG as fuel and incorporates two LNG fuel tanks positioned on both sides of the open deck.

HHI executed the ship’s basic design, established the layout of fuel supply pipes and the gas detection system and designed the LNG fuel tank using their technical expertise.

Verified

KR verified the safety, suitability and the regulatory compliance of the design by reviewing national and international regulations, leading to the issuance of the AIP for the LNG dual-fuel VLGC.

“KR has been focusing on the development of eco-friendly technologies relevant to LNG for several years because LNG is considered a major alternative that can meet the international regulations,” said Kim Yeontae, Executive Vice President of KR’s Technical Division.

“We will further enhance our customer support to respond to decarbonization, based on our experience and technologies acquired from joint development projects with shipyards,” Kim added.

Jeon Seungho, HHI’s Senior Executive Vice President and Chief Technical Officer, said he was delighted with the award.

“HHI has been working to develop eco-friendly fuel propulsion ships such as LNG using our accumulated design technologies, and we are pleased to demonstrate our technical expertise with this AIP,” Jeon explained.

Order book

“We will continue to make technological innovations for the development of eco-friendly ships,” he stated.

HHI is one of the world’s leading builder of LNG carriers as well as LNG-powered vessels at its Ulsan shipyard.

The advanced facilities give the Korean company a 10 percent share of the global market. The main HHI yard stretches over 4 kilometres along the coast and has 10 large-scale drydocks with nine huge “Goliath Cranes”.

The Korean Register (KR), the maritime classification society of the Republic of Korea with 80 offices around the world, has awarded an Approval in Principle to HD Hyundai Heavy Industries for a new type of tank shape designed for various liquefied gases and fuels.

The Korean society said that new tank shape developed by HD HHI, the nation’s largest shipbuilding company and formerly called Hyundai Heavy Industries Holdings Co., is designed to improve maritime safety and productivity.

“The new tank shape aims to address the challenge of sloshing that impacts the transportation of liquefied gases such as LNG,” said KR.

“Sloshing refers to the wave-like movement of liquid inside a tank during sea transport. It is crucial to ensure structural stability by minimizing sloshing flow caused by the ship's motion, as excessive sloshing can exert significant impact forces on the tank walls, jeopardizing its structural integrity,” KR explained.

Classed fleet

The society, headquartered in the South Korean port of Busan, currently classes an international fleet of 3,080 vessels.

KR said that HD HHI has successfully optimized the shape of the liquefied gas tank, effectively reducing the sloshing effect and enhancing stability.

“This significantly mitigates the risk of accidents and potential disasters during transportation. Furthermore, the innovative tank design incorporates an improved layout, leading to enhanced work efficiency and productivity,” added KR.

“The newly developed tank shape exemplifies cutting-edge technology that combines improved safety measures, increased productivity and efficient sloshing reduction techniques,” KR said.

HD HHI said it planned to expand the application of the new tanks to various liquefied gas carriers and other ships in the future.

It was expected that HD HHI would continue to strengthen its competitiveness in the liquefied carrier shipbuilding market, including LNG, by “providing safe and reliable solutions” to customers.

KR stated that it was “committed to actively collaborating” with the technology development of new tank types.

“As a leading classification society, KR will provide comprehensive technical support to facilitate the development of next-generation eco-friendly ships, further promoting the advancement of maritime industry,” it added.

Gaztransport and Technigaz (GTT), the French LNG storage technology company for shipping and onshore, said the Supreme Court of Korea rejected GTT's appeal on licence and technical assistance deals with South Korean shipyards.

The Paris-based company had appealed against the decision of the Seoul High Court confirming the company's obligation to separate, in whole or in part, the “Technology License and the Technical Assistance” agreements if requested by the South Korean shipyards it has dealings with.

GTT had filed its appeal against the Korea Fair Trade Commission (KFTC) decision in December 2022.

“GTT acknowledges this very surprising decision, which comes only three months after the decision of the same Supreme Court of Korea to suspend the effects of the decision of the Seoul High Court,” said GTT.

The French company said it considered that its provision of technical assistance and engineering services “were essential to ensure the safety and performance” of its solutions and that its “unique expertise” was crucial to the safety of LNG maritime transport.

Defending interests

“Convinced of the sound basis of its contractual provisions, GTT is still committed to defending its interests and those of the entire LNG industry, and is considering the most appropriate actions to be taken in order to maintain its rights,” stated the Paris-based company.

“The company does not anticipate any significant financial impact in the short or medium term,” it added.

The KFTC in December 2022 had ordered GTT to allow the Korean shipyards, upon their request, to perform all or part of the technical assistance services currently included in the technology licenses and to pay €9.5 million ($10.40M) as an administrative fine.

The loss of the Korea appeal comes as GTT continues to expand its relationships with Chinese companies and shipyards where it has similar accords and is building the LNG tanks storage technology business.

On the occasion of the visit of French President Emmanuel Macron’s to Beijing on April 6, 2023, PipeChina Engineering Technology Innovation Co. signed a cooperation agreement for the evaluation and further promotion of GTT’s membrane containment tank technology for LNG projects in China.

PipeChina Group is currently operating seven LNG receiving terminals in China and three new LNG import projects are under construction.

As the largest operator of LNG infrastructure in China, PipeChina said it was keen to expand its cooperation with GTT.

Adnan Ezzarhouni, General Manager of GTT China, explained that GTT had already delivered onshore tanks to the Chinese.

These were for a peak-shaving project at Hejian in Hebei province, operated by Huagang Gas, as well as Phase I of the giant Beijing Gas Tianjin-Nangang onshore LNG terminal and the company was seeking additional contracts.

GTT has major collaborations with major Chinese shipyards such as Hudong-Zhonghua Shipbuilding, a subsidiary of China State Shipbuilding Corp., and Jiangnan Shipbuilding located northeast of Shanghai on Changxing Island at the mouth of the Yangtze River.

Winterthur Gas & Diesel (WinGD), headquartered in Switzerland, said WinGD’s latest generation of X72DF-2.1 engines will power 25 vessels as part of the QatarEnergy’s North Field East (NFE) project, the biggest LNG carrier newbuilding project in history.

July 22 (LNGJ) - Daewoo Shipbuilding & Marine Engineering, South Korea’s third-largest shipbuilder and a leading construction yard for LNG carriers, is on the verge of ending a dispute with contracted workers that has disrupted work at the Goeje facility in South Gyeongsang province and cost the company more than $400 million as of July 21.

   DSME said the construction of eight vessels at five docks at the shipyard has been hampered with delivery dates pushed back by two to five weeks. The union representing the striking workers, the Korea Metal Workers’ Union, has now informed the company they were willing to end their strike and accept a previously offered wage increase if lawsuits seeking damages from the strikers were dropped.

The global LNG fleet is heading for the 800 vessels mark from the current 700 ships with South Korean shipyard Daewoo Shipbuilding and Marine Engineering (DSME) being the latest to receive a $850 million order for four newbuilds from Qatar.

The orders are increasing to keep pace with LNG and demand liquefaction plant expansion by nations such as Qatar and the US.

DSME, the world's No. 4 shipbuilder by order backlog, said it would build the vessels with 174,000 cubic metres of capacity at the Okpo shipyard on the south coast and deliver them by the first half of 2025.

The order is the first result of a $19 billion contract that DSME and two other Korean shipbuilders, Hyundai Heavy Industries and Samsung Heavy Industries, have signed with QatarEnergy to construct scores of LNG vessels through 2027.

The contract is in line with Qatar's plan to boost its LNG production capacity to 126 million tonnes per annum by 2027 from the current 77 million tons.

Analysts said that DSME's order is widely expected to lead to the securing of more orders for LNG carriers by the three major Korean shipbuilders.

DSME won $4 billion in orders in the first quarter of 2022, including eight LNG carriers, six containerships, one offshore platform and one depot maintenance order.

The six containerships ordered had a specification for dual-fuel capability.

Among the LNG shipping companies ordering the newbuilds in the first quarter was GasLog Ltd, the Greek LNG shipping firm.

GasLog is currently expanding its fleet ordered four newbuild 174,000 cubic metres capacity vessels for delivery in 2024 and 2025.

The yard added that the GasLog ships would also be equipped with the latest generation M-type Electronically Controlled, Gas Injection (ME-GI) propulsion system.

They would also fitting a more advanced re-liquefaction system.

Last year 68 LNG newbuilds were delivered compared with 47 LNG ships in 2020.

The global LNG fleet consisted of 700 vessels at the start of 2022 and is now headed for 800 in the next two or three years.

The current total includes 48 floating storage and regasification units that can act as import terminals. Total cargo capacity in 2022 was more than 105 million cubic metres.

The average spot charter rate for a 160,000 cubic metres LNG carrier stood at around $89,200 per day last year compared with $59,300 per day in the previous year.