Global LNG fleet expands at faster pace as Qatar orders more newbuilds from South Korean shipyard
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.
Korean shipbuilding group wins orders for seven LNG carriers to meet global expansion of liquefaction
Korea Shipbuilding and Offshore Engineering Co. (KSOE), the nation's largest shipyard group, has won orders to build seven liquefied natural gas carriers at a time of increased competition from Chinese shipyards.
The company said the orders were worth a combined 1.56 trillion won ($1.35 billion) in value and come at a time when the Korean industry was been winning a larger portion of global orders for all kinds of ships.
KSOE is a holding company of three shipbuilders comprising Hyundai Heavy Industries, Hyundai Samho and Hyundai Mipo Dockyard Co.
With the latest LNG newbuilds, KSOE said it had obtained orders for 176 ships and two offshore plants worth the equivalent of $16.8Bln so far this year, exceeding its annual order target of almost $15.0Bln.
The Korean LNG carrier orders are a mix from both Asian and European shipowners and covered all three subsidiaries.
South Korea had re-taken the global No. 1 ranking for monthly orders in May 2021 after losing it to China in April 2021, nine months after retaking the leading position in global shipbuilding in July 2020.
During the first part of 2021, Korean shipbuilders also won orders for 31 ships to be propelled by LNG, taking up 46 percent of 67 LNG-powered ships ordered in the year to date.
The Korean yards are still favoured by Russia in its LNG shipping expansion.
A Russian newbuild ordered from Hyundai Heavy Industries will be the latest in a series of Sovcomflot’s next-generation conventional Atlanticmax LNG carriers, with three sister ships already in operation, the “SCF La Perouse”, the “SCF Barents” and the “SCF Timmerman”.
The newbuild will have capacity of 174,000 cubic metres and be owned and operated by Sovcomflot, with options for HHI to build two additional vessels.
The newest Korean-built Russian vessel would be fitted with an X-DF propulsion system, operated by a slow-speed diesel engine with a direct drive to the propellers, enabling a substantial reduction in the vessel’s fuel consumption.
