© Reuters. FILE PHOTO: A liquefied natural gas (LNG) tanker is pulled toward a thermal power station in Futtsu city, east of Tokyo, Japan, on November 13, 2017. REUTERS/Issei Kato
Joyce Lee and Florence Tan
SEOUL (Reuters) – Korea Shipbuilding and Offshore Engineering Corporation (KSOE) has mostly fulfilled orders for the next 2-1/2 years as the pandemic increases demand for container ships, leaving little room for liquefaction (LNG) cargoes. demand, said a senior company executive.
As U.S. LNG exports increase, more LNG carriers are transporting longer distances to customers in North Asia and Europe, while European countries purchase floating storage and regasification units (FSRUs) as they Increased LNG imports to replace Russian gas supplies. Ukraine crisis.
However, with U.S. and Chinese ships hampered by global supply chain disruptions and port congestion, South Korean and Chinese shipyards are unable to keep up with demand for new LNG ships as they scramble to fill a flood of orders for new container ships. All-time high spot charter rates for LNG carriers.
“A large number of newbuilding orders have filled the vacancies in Chinese and South Korean shipyards,” KW Kim, senior vice president of Hyundai Heavy Industries, the flagship unit of the world’s largest LNG carrier, told Reuters.
KSOE is almost at capacity and orders will continue until 2025, he said, adding that container ships and LNG carriers each account for about 30 percent of the space. KSOE builds 20 to 22 LNG carriers annually.
South Korean shipyards are also struggling to operate due to labor shortages, while dealing with steel prices that have almost doubled, Kim said.
“Currently, we are unable to receive new orders from the FSRU,” he added.
For 2020, Qatar Gas and TotalEnergies have reserved shipbuilding spots for LNG projects in Qatar and Mozambique, respectively, while U.S. LNG producers are also looking for more ships as their exports grow, he said.
“Owners enjoy good charter rates,” says Kim.
He added that about half of the new commercial vessel orders were for vessels powered by dual-fuel engines (LNG or methanol) and oil. Hyundai Heavy Industries builds methanol-based container ships for AP Moller-Maersk.
Demand for smaller tankers — Aframaxes and midsize tankers — is also increasing as Europe seeks to import more oil products from elsewhere to replace Russian supplies, Kim said.