South Korea’s Samsung Heavy Industries has won an LNG order valued at US$1.5Bn from an undisclosed buyer, according to a regulatory filing by the company
Samsung Heavy Industries (SHI) did not reveal the name of the client which it identified as being in the “Eurasian region.” The initial LNG carrier under the contract will be delivered in September 2022. The number of vessels contained in the order was also not disclosed.
Current LNG carriers with capacities of 174,000 m3 being built at SHI are valued between US$182M and US$186M.
Eurasia encompasses Qatar, where Qatar Petroleum is looking for 40 LNG carriers to cover its initial expansion plan that will raise its LNG capacity from 77 mta to 110 mta by 2023.
Those plans have grown following an announcement by Qatar Minister of Energy Affairs and Qatar Petroleum (QP) chief executive and president Saad Sherida Al-Kaabi on 25 November. Minister Al-Kaabi said QP plans to raise Qatar’s LNG production capacity to 126 mta by 2027, representing an increase of 64% from the current 77 mta.
The raise in production is underpinned by more extensive reserves than initially believed. Minister Al-Kaabi said new studies have revealed that the North Field’s productive layers extend well into Qatari land in Ras Laffan, paving the way for a new LNG production project in the north of Qatar.
“These are very important findings, which will have a great positive impact on Qatar’s gas industry, and which will move it forward into bigger and wider horizons,” said Minister Al-Kaabi. “These results will also enable us to immediately commence the necessary engineering work for two additional LNG mega trains with a combined annual capacity of 16M tonnes per annum. This will raise Qatar’s overall hydrocarbon production to about 6.7M barrels oil equivalent per day.”
Besides the 40 LNG carriers initially needed by Qatar Petroleum, Total requires 16 for Mozambique, Novatek 15 ice-breaking vessels for Arctic LNG-2 and ExxonMobil 20 for the start-up of Golden Pass LNG in the US in 2024. As many as 381 additional LNG carriers will be needed by 2025 based on current LNG export plans, SHI told investors.
SHI has inked a memorandum of understanding with Russia’s Zvezda Shipbuilding to provide technical and design expertise for the construction of as many as 17 Arc7 class LNG carriers for the Arctic LNG-2 project. Those vessels would be the first ice-breaking LNG carriers to be built in Russia, with delivery between 2023 and 2026.
With the latest contract, SHI has now won shipbuilding orders of US$6.9Bn, surpassing last year’s total of US$6.3Bn. SHI set a budget of US$7.8Bn for 2019.