By Julianne Geiger of OilPrice.com,
Three of China’s shipyards won almost a third of this year’s orders to make new LNG carriers, Reuters said on Monday.
China’s shipyards—only one of which has experience building new LNG tankers—are getting a significant piece of the pie for new LNG carriers, which hit a record this year at 163 orders. The orders that China’s shipyards are seeing tripled this year, to 45, and some of China’s shipmakers that only recently became certified to build the LNG tankers, are even seeing foreign orders for the first time ever.
China’s LNG tanker orders this year are valued at nearly $10 billion—about five times the order value of last year, Clarksons Research showed, cited by Reuters.
South Korean shipyards usually get a large share of the LNG tanker orders, but they are already at capacity as they try to service Qatar’s North Field expansion. This has created a backlog for South Korean shipyards, and has increased costs to build LNG tankers. The end result is that even foreign buyers who look favorably on South Korea’s ability to design and build LNG tankers free from problems are now giving a serious look at China—even for companies that have zero experience with the intricacies of LNG shipbuilding.
“As more Chinese gas traders engage local shipyards, they will be forced to climb the learning curve and eventually grow the whole industry,” Li Yao, founder of Beijing-based consultancy SIA Energy, told Reuters.
As of late November, Chinese shipyards had orders for 66 LNG tankers, bringing its total to 21% of all global LNG tanker orders, worth some $60 billion.
LNG tankers are notoriously difficult to build, and typically take more than two years to complete.
The LNG boom comes as 20 million tonnes of gas per year is set to ship from the United States.