Samsung Heavy Industries and Hanwha Ocean are expected to wrap up shipbuilding contracts in March. QatarEnergy has expanded the size of its second phase LNG carrier ordering project.
QatarEnergy, Qatar’s state-run energy company, has increased the number of reserved slots at Samsung Heavy Industries, Hanwha Ocean, and Hudong Zhonghua Shipbuilding to 40 in the second phase of its LNG carrier ordering project, according to industry sources and foreign media reports on Jan. 15.
Samsung Heavy Industries has confirmed slots for 15 vessels, while Hanwha Ocean has for 12. Hudong Zhonghua Shipbuilding has signed contracts for eight 271,000 cubic meter Q-Max vessels.
Qatar, the world’s largest LNG exporter, plans to ramp up its LNG production from the current 77 million tons per year to 126 million tons by 2027. According to experts, the country needs more LNG carriers. Increasing the number of Q-Max vessels, which is larger than the standard 174,000 cubic meters, will reduce the cost of transporting cargo.
Korean shipbuilders that signed slot reservation contracts based on general vessel types will lose productivity if they build Q-Max vessels. A 174,000-cubic-meter LNG carrier is 299 meters long and 46.4 meters wide, so two 174,000-cubic-meter LNG carriers can be built side by side on a shipyard dock. However, a Q-Max vessel is over 50 meters wide, so two Q-Max vessels cannot be built in parallel.
Hudong Zhonghua Shipbuilding has no experience in building Q-Max vessels. The Chinese shipbuilder has been actively pursuing orders for Q-Max vessels at GASTEK 2023 in Singapore since September 2023. It signed a conceptual certificate for Q-Max vessels with a number of global classification societies including DNV at GASTEK 2023.
Each of the vessels to be ordered this time will have five cargo holds. Each is 344 meters long, 53.6 meters wide, and can carry 271,000 cubic meters of LNG, more than a 265,000-cubic-meter Q-Max vessel. Their cargo holds will feature the same membrane NO96 Super+ as those of ships to be built by Hanwha Ocean.
With QatarEnergy’s order for Q-Max vessels with the Chinese shipbuilder, Korean shipbuilders will be building 174,000-cubic-meter LNG carriers only. Samsung Heavy Industries and Hanwha Ocean are also expected to receive orders for the same level of vessels as those in their existing slot reservations from QatarEnergy, regardless of QatarEnergy’s contracts with Hudong Zhonghua Shipbuilding.
HD Hyundai Heavy Industries (HHI) won orders for 17 LNG carriers from QatarEnergy in 2023. The order far exceeded industry expectations. Some experts say that the order may affect order volume allocated to Samsung Heavy Industries and Hanwha Ocean. HD Hyundai effectively landed the first batch of LNG carrier orders from Qatar.
In October 2023, HD Hyundai signed a contract with QatarEnergy totaling US$3.9 billion, or about US$229.41 million per vessel. QatarEnergy is expected to propose prices based on its contract with HD HHI’s contract in price negotiations with Samsung Heavy Industries and Hanwha Ocean.