China State Shipbuilding Group, the world's largest, successfully signed an order for 18 ultra-large LNG carriers

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China Research Network

China State Shipbuilding Corporation (CSSC) and QatarEnergy signed a contract for the construction of 18 ultra-large liquefied natural gas (LNG) carriers of 271,000 cubic meters in Beijing

On April 29, 2024, China State Shipbuilding Corporation (CSSC) and QatarEnergy successfully signed a record-breaking shipbuilding contract in Beijing. According to the terms of the contract, CSSC will be responsible for the construction of 18 ultra-large liquefied natural gas (LNG) carriers with a capacity of 271,000 cubic meters, which is a new global record for a single shipbuilding order.

The ultra-large LNG carriers will be designed and built by shipbuilders with high professional technology and rich experience under CSSC. The vessels will be equipped with advanced technology and efficient energy systems to ensure that LNG is transported efficiently, safely and environmentally friendly.

This cooperation not only reflects the outstanding strength of CSSC in the field of ultra-large LNG ship construction, but also marks the further enhancement of China's status and influence in the global shipbuilding industry. At the same time, it also provides QatarEnergy with strong transportation support, helping it to meet its growing energy demand.

It is worth mentioning that QatarEnergy Group previously announced the internationally renowned "100 Ships Plan", planning to build more than 100 large LNG carriers to meet the capacity required after its upstream capacity expansion. CSSC's successful acquisition of 18 of the world's largest LNG carriers in the "100 Ships Program" is not only an important breakthrough in China's shipbuilding industry in the international market, but also another important achievement of China-Qatar cooperation in the energy field.

Looking forward to the future, CSSC will continue to strengthen cooperation with internationally renowned energy companies and continuously enhance its competitiveness and influence in the field of high-end ship R&D, design and construction. At the same time, China will actively participate in global energy governance and cooperation, and make greater contributions to promoting the sustainable development of global energy.

Published by the Academia Sinica

LNG carriers are recognized as one of the most difficult ship types in the world to build, and are "super refrigerated vehicles" carrying LNG at minus 163 degrees Celsius, and are one of the three "crown jewels" of the world's shipbuilding industry. The ship type of the signed project is the world's largest LNG carrier, which will be independently designed and built by Hudong-Zhonghua, a subsidiary of China State Shipbuilding Group, with a total length of 344 meters, a width of 53.6 meters, a depth of 27.2 meters, a design draft of 12 meters, and a dual-fuel low-speed engine propulsion and NO96 Super+ enclosure system.

According to reports, this type of ship has five major technical characteristics: in terms of cabin capacity, it adopts a 5-cabin scheme with a compact scale, which is 57% higher than the carrying capacity of a conventional 174,000 cubic meter large LNG ship; In terms of performance, the multi-objective optimized double stern fin line has excellent rapidity, lower evaporation rate, and the energy consumption per ton of nautical mile cargo transportation is 9.9% lower than that of 174,000 cubic meters LNG carrier. In terms of safety, the tank adopts an enhanced insulation module, and is equipped with a real-time sway monitoring system, a stress monitoring and anti-collision system for the hull, which provides multiple guarantees and high safety and reliability. In terms of maneuverability, it is equipped with a reliquefaction system and an axial reverse booster system, which is flexible in handling, and the carbon emission intensity CII is 23% lower than that of the 174,000 cubic meter LNG ship, which can flexibly match various operating sections of different routes. In terms of compatibility, the draft and stowage design are diversified and optimized, covering all major mainstream routes.

In 2020, QatarEnergy Group announced the internationally renowned "100 Ships Plan", which aims to build more than 100 large LNG carriers to meet the capacity required for its upstream capacity expansion. In April 2020, CSSC signed a strategic cooperation agreement with QatarEnergy to form a comprehensive strategic partnership. In 2022, Hudong-Zhonghua and CSSC Trading, subsidiaries of China State Shipbuilding Group, signed an order for 12 conventional 174,000 cubic meter LNG carriers under the "100 Ships Plan" with QatarEnergy Group's designated winning shipowners.

The successful acquisition of 18 orders for the world's largest 271,000 cubic meter LNG carriers in the "100 Ships Plan" is an important embodiment of the continuous improvement of CSSC's international influence in the field of ultra-large LNG ship construction, marking that China's LNG ship R&D, design and construction has stepped into the ultra-large field in one fell swoop, and the R&D and design capabilities of high-end ships have moved towards the world's leading goal.

The increase in China's bulk imports was concentrated in March and April, and the over-concentrated imports overdrew the activity of the follow-up market, such as the high inventory of power plants after the centralized import of coal, which affected the growth of subsequent imports, making the market inelastic and difficult to maintain the rise.

In the first half of the year, the world's bulk cargo shipping increased by 4.1% year-on-year. Iron ore increased by 2.5% year-on-year, shipments from Australia increased, and Brazil was low; Coal increased by 6% year-on-year, with more growth in Indonesia and Australia; Grain shipments increased by 1.2% year-on-year, with Brazil's bumper export growth, but Argentina and the United States exports were lower than in previous years; the gradual recovery of the Black Sea; Small parcels fell by 4.7% year-on-year, steel, miscellaneous goods, etc. generally fell, and Guinean bauxite increased significantly.

Last year, Hudong-Zhonghua undertook 29 orders for large LNG carriers, setting a record high. In the first half of this year, Hudong-Zhonghua delivered a total of 9 ships, with a new order amount of more than 20 billion yuan, which was 56% and 72% of the annual plan respectively; Looking at Chinese shipbuilders, the market share of the world's large LNG carriers has jumped to 35%.

The global LNG trade volume will continue to grow, and the global average annual demand is expected to be 50 to 60 ships from 2025 to 2030, coupled with the loss of capacity caused by ship speed reduction under the new rules and regulations, and the loss of capacity caused by the dismantling and modification of old ships.

China Merchants Shipping announced on August 28 that its revenue in the first half of 2023 was 12.99 billion yuan, a year-on-year decrease of 5.37%, mainly due to the decline in the dry bulk transportation and container transportation markets, and the year-on-year decrease in revenue from the dry bulk and container transportation sectors; At the same time, the oil tanker transportation market has rebounded, the freight rate has risen, and the income of the oil tanker transportation sector has increased significantly; Revenue decreased year-on-year due to the combined impact. net profit attributable to the parent company was 2.771 billion yuan, a year-on-year decrease of 4.13%; Basic earnings per share was 0.34 yuan.

During the reporting period, as a professional shipping company focusing on international and domestic cargo transportation, the company took oil and gas (LNG) transportation and dry bulk cargo as its dual core main businesses, and other fleets (containers, automobile ro-ro transportation, special transportation, etc.) as organic supplements, with a clear business layout, market coverage and complete types of cargo sources. Combined with market conditions, the company flexibly adopts a variety of ways to carry out production, operation and investment activities in an orderly manner.

Since the beginning of this year, the prosperity of the global shipping industry has gradually spread from containers to almost all sub-sectors such as oil tankers, LNG carriers, and special ships.

As of the end of April 2023, there were 668 LNG carriers worldwide, including 45 floating storage and regasification units (FSRUs) and 8 floating storage units (FSUs). The size of the fleet increased by 4% compared to 2021. There are 312 ships under construction worldwide, equivalent to more than 46% of the current active fleet. It is expected to deliver 28 ships in 2023, 81 in 2024 and nearly 90 in 2025.

The outbreak of orders for large LNG carriers this year is mainly due to the increase in demand for environmentally friendly energy and the impact of the Russia-Ukraine war. In addition, QatarEnergy has discovered large-scale natural gas fields and accelerated the pace of natural gas development, and QatarEnergy has booked more than 100 LNG ship slots for Chinese and South Korean shipbuilders.

In the past August, Chinese shipbuilders returned to the first place in the world with 1.02 million CGT (35 ships) in order, and South Korea ranked second with 760,000 CGT. In this regard, South Korean media said that this is the result of South Korean shipping companies "giving priority to high value-added orders and selectively receiving orders".

According to data released earlier by relevant institutions in the shipping industry, in the first seven months of this year, the global order for new ships was 812, while China accounted for 422 orders, and the number of orders for building new ships was far ahead of the world. According to the latest news from the Ministry of Industry and Information Technology on September 6, China's shipbuilding industry has ranked first in the world in the international market for 12 consecutive years, and its status and influence in the global LNG ship industry chain have continued to increase, and the status of a major shipbuilding country has been further consolidated.

The profitability of the LNG carrier industry is vividly depicted from multiple perspectives of market changes, and the development direction is clear. In terms of form, the LNG ship report is dominated by rich data and charts, highlighting the readability and visibility of the article, and avoiding clichés and empty words.

In the future, there is a huge space for the development of the LNG carrier industry, so what is the current situation of this industry?

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