Korean shipbuilders report LNG carrier ordering spree

In the last few days of December 2020, South Korean shipbuilders are witnessing a surge in liquefied natural gas (LNG) carrier orders.

Since 21 December, Samsung Heavy Industries (SHI) secured orders for the construction of eight LNG carriers and Korea Shipbuilding & Offshore Engineering Co. (KSOE) for nine LNG carriers.

On 23 December, SHI said it signed a KRW 815 billion ($734 million) deal with a shipowner from Africa. The deal covers four LNG carriers to be delivered by 31 May 2024, according to information SHI provided in a stock exchange filing.

What is more, SHI unveiled two separate LNG carrier construction deals with Oceania-based companies on 21 and 22 September. The first deal, valued at KRW 408.2 billion, encompasses two vessels planned for delivery by the end of February 2024. The second order, worth KRW 403.5 billion, includes two units scheduled to be handed over by 30 September 2024.

The shipbuilder has so far this year received orders worth $5.5 billion, representing 65% of its annual target, according to Yonhap News Agency.

Also on 23 December, KSOE, the world’s largest shipbuilder, revealed on a stock exchange that it was awarded two separate contracts to build three LNG carriers.

The first order, worth KRW 201.9 billion, was placed by a Panamanian shipping company. It includes one unit slated for delivery by 30 August 2024. The ship will be constructed by KSOE’s subsidiary Hyundai Samho Heavy Industries (HSHI).

The second order amounts to KRW 410.3 billion. Under this deal, two newbuilds will be handed over by HSHI to a Bermuda-based owner by 23 November 2023.

KSOE reported deals covering another six LNG carriers on 21 and 22 December. Four vessels under two separate contracts will be built for undisclosed companies based in Panama. Similarly, two more units will be constructed for an unnamed shipping company in Oceania.

KSOE’s orderbook currently stands at $10 billion, representing 91 per cent of the shipbuilder’s annual target.

Not only LNG carriers but also other vessel types such as containerships and very large crude carriers (VLCC) were recently ordered from Korean builders.

Although the coronavirus pandemic has caused considerable negative impacts on the global shipbuilding industry, South Korea’s major three shipbuilders delivered a robust business performance in 2020. KSOE, SHI and Daewoo Shipbuilding & Marine Engineering Co. (DSME) have met 91 per cent, 65 per cent and 75 per cent of their 2020 targets, respectively, Yonhap cited industry sources as saying.