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LNG newbuild prices hit US$250M as Chinese yards scoop up orders
LNG newbuilding prices continued their upward climb in week 44 2022, touching US$250M apiece in a deal for three 174,000-m3 LNG vessels at China’s Hudong-Zhonghua
The deal inked by China’s Tianjin Southwest Maritime will see the trio delivered in 2028 into long-term contracts with ENN Natural Gas, China.
Shipowners should not expect prices to plateau yet, noted BRL Weekly Newbuilding Contracts, saying, “Prices will probably go higher.”
Chinese shipyards have continued to benefit from the bulging orderbooks at South Korean shipyards as capacity at South Korea’s Big Three, notably Daewoo Shipbuilding & Marine Engineering, Hyundai Heavy Industries and Samsung Heavy Industries – has been sopped up by the surge in contracts for LNG and container newbuilds.
Among the newcomers to take on the challenge of of building large gas carrier tonnage is Yangzi Xinfu, which won order from two German shipowners who have combined to confirm two 175,000-m3 LNG carriers for delivery in December 2025 and June 2026.
One of the advantages shipowners have in going to newcomers to the LNG newbuilding arena is earlier deliveries, but those shipowners should also be prepared for growing pains and steep learning curves.
“One advantage is relatively early deliveries over competitor yards, but the new builders will probably have to deal with start-up problems,” said BRL. The two German shipowners entering LNG for the first time are Hammonia Reederei and Peter Dohle, “both well-established shipowners operating other vessel categories,” noted BRL.
China’s Jiangnan Shipbuilding, which has been involved for around three years in the LNG business, secured an order for two 171,320-m3 LNG newbuildings from Shandong Shipping, making its debut in LNG shipping. Shandong holds options for two more ships for delivery H2 2027. “A per ship price of US$197M applies, although this does seem a little low unless there is some favour for the owner,” said BRL.
Long-term charters for these vessels are committed to China’s Sinopec.
“The most talked about order” for the week was secured by China’s Dalian Shipbuilding Industry, according to BRL. The shipbuilder now holds orders for 10 LNG carriers but has yet to complete a ship. The latest order marks a joint venture between Mitsui OSK Lines and China’s Cosco Shipping LNG Investment with probable long-term charter to Sinopec. All three vessels are 175,000 m3 and will deliver in 2026 and 2027 with a cost of US$230M apiece. The joint venture holds an option for two more LNG newbuilds.
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