Twenty LNG carriers for Qatar’s upcoming liquefied natural gas (LNG) project are likely to be built in Korea. Qatar Energy, a state-run energy company for the project, is in talks with HD Korea Shipbuilding & Offshore Engineering (KSOE), Hanwha Ocean, and Samsung Heavy Industries to build LNG carriers worth a total of $5 billion.
Qatar will order LNG carriers of 174,000 cubic meters (One CBM: one cubic meter) and 271,000 CBMs, according to sources in the shipbuilding and shipping industry on Sept. 24. Of these, the 271,000 CBM LNG carrier is expected to have the same specifications and performance as a Qatar-China-Max (QC-MAX) LNG carrier, the largest vessel capable of calling at Qatari and Chinese ports. Hudong Zhonghua Shipbuilding took an order for six QC-MAX LNG carriers on Sept. 9.
Qatar Energy has signed contracts valued at $30 billion to build or lease 122 new LNG carriers in the last two years through its LNG fleet expansion project.
Qatar Energy ordered 60 vessels in the first phase in 2022 and 62 vessels in the second phase in 2024. It is the largest single project in the history of the world shipbuilding industry, and the vessels secured by Qatar will be used for its North Field and Golden Pass LNG Projects.
Between late last year and early this year, the three major Korean shipbuilders received orders for 44 LNG carriers from Qatar. They are all 176,000 CBM ships including 17 for HD KSOE, 15 for Samsung Heavy Industries, and 12 for Hanwha Ocean. China’s Hudong Zhonghua Shipbuilding had taken orders for more than 10 vessels and recently won an order for six more ships.
Qatar Energy took the wraps off its North Field West Project earlier this year. The project is aimed at an expansion of its North Field Gas Field which produces 77 million tons of LNG per year. The Qatari energy giant will produce LNG 16 million tons more per year. The increase in production led the company to decide to secure more carriers than the previously planned total of 62 (the second batch).
Orders for the additional carriers were initially expected to go to the three Korean shipbuilders, but Qatar Energy has shifted some of the orders to China. This includes a 271,000 CBM LNG carrier recently ordered from Hudong Zhonghua Shipbuilding. Only three years ago, Hudong Zhonghua Shipbuilding, a subsidiary of China Shipbuilding and Shipping Corporation (CSSC), was the only shipyard in China capable of building LNG carriers but Dalian Shipbuilding Industry Company (DSIC) and CMHI Jiangsu of CMG, are expanding their influence with the ability to build large LNG carriers.
A future outlook is bright for the LNG shipping market. While China is threatening Korea with its shipbuilding technology and production capacity, LNG projects underway in Qatar and elsewhere around the world make experts forecast that ship supply will not keep up with demand for ships for the time being.
“Over the next five to 10 years, shipbuilders will receive orders for 40 to 60 LNG carriers every year,” said Martin Cartwright, head of DNV’s global business for gas carriers and floating storage regasification units (FSRUs). “The shipbuilding industry will see a combination of additional LNG carrier projects and the need to replace old LNG carriers currently in service. This will mean that more LNG carriers will be needed after 2028 than today.”
Source: Business Korea
