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Korean Shipbuilders Sweep Orders for Large LNG Tankers
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Korean Shipbuilders Sweep Orders for Large LNG Tankers
  • By Jung Min-hee
  • August 7, 2018, 12:29
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The three major Korean shipbuilders swept all of the orders for 30 units this year.
The three major Korean shipbuilders swept the orders for 30 LNG tankers this year.

Korean shipbuilders have swept all of the orders for 30 large liquefied natural gas (LNG) tankers from around the world this year. Shipbuilding industry watchers say that Korean shipbuilders outweighed those of China, Japan, and other competitors in terms of accumulated experience, technology and price competitiveness.

According to data released by Clarkson, a UK shipbuilding industry analysis organization, on August 6, Daewoo Shipbuilding and Marine Engineering (DSME) received orders for 12 LNG tankers, the Hyundai Heavy Industries Group orders for 14 and Samsung Heavy Industries orders for four this year. The three major Korean shipbuilders swept all of the orders for 30 units.

LNG tankers are the most expensive single vessel type currently in the shipbuilding sector. An LNG tanker is priced at about US$185 million. In particular, their unit price is on a steady rise so it is up about US$5 million from the beginning of this year.

This year LNG tanker orders were concentrated mostly in the first quarter. According to Clarkson, global LNG tanker orders amounted to 19 units (1.6 million CGTs) by March this year. The 19 units are the largest quarterly figure since the fourth quarter of 2014.

Now that LNG tanker orders concentrated in the first quarter, they have somewhat slowed down since then. However, the shipbuilding industry is expecting that LNG tanker orders will increase steadily.

Experts in the shipbuilding industry are expecting that Cheniere Energy of the US, Trafigura of Switzerland and BP of the UK will place orders for LNG tankers this year. Clarkson predicted that the average annual global order for LNG tankers would stand at 52 in the 2020 to 2023 period. This is three times as many as last year's 17 units. In particular, 194 LNG tankers will be ordered for the next five years.

Technological prowess was the main driving force behind Korean shipbuilders’ sweep of LNG tanker orders in the global market. China has not yet made a full-fledged entry into the LNG tanker sector, and Japanese shipbuilders lagged behind Korean counterparts as their technology is one generation behind Korean shipbuilders’ technology..

Liquefaction technology is applied to LNG tankers. The technology returns liquefied gas to a storage tank. All domestic shipbuilders are most advanced technologically because they have full re-liquefaction systems.