South Korean shipyards anticipate $12bn in orders are coming their way from the state-owned petroleum company of Qatar.

South Korea, LNG

The state-owned petroleum company of Qatar is eyeing 60 new super-sized liquefied natural gas (LNG) carriers to expand its fleet, contracts which are likely to be won by South Korea’s major shipbuilding companies.

According to a local Korean media report, the Chief executive of Qatar Petroleum (QP), Saad Sherida al-Kaabi, revealed during a visit to South Korea that the state-owned company was considering placing orders for 60 new super-sized LNG carriers.

The capacity of the carriers is expected to be 210,000-266,000 cubic metres, which is 30 per cent larger than regular LNG tankers. Each ship costs more than $200 million, meaning the deal could be worth at least $12 billion.

Al-Kaabi toured shipyards belonging to Hyundai Heavy Industries (HHI), Daewoo Shipbuilding & Marine Engineering Company (DSME) and Samsung Heavy Industries Company to assess their capabilities to build ultra-large LNG vessels, the media report said.

Qatar, LNG and South Korea

QP is the world’s largest supplier of LNG, with an annual production of 77 million tonnes. In September 2018, it announced it would further ramp up its annual capacity to 110 million tonnes by 2023-24 by adding a fourth gas liquefaction train.

The state firm has been intending to expand its fleet of LNG carriers as part of its expansion plan.

“Most of QP’s 50 LNG carriers were produced by Korea’s top three shipbuilders,” Chung Sung-lip, the Chief Executive of DSME, was quoted as saying: “This is why we believe they [QP] will turn to Korea for the new order.”

South Korea’s big three shipbuilders won the contracts for LNG carriers from QP between 2004 and 2007. Last year, the three firms were awarded 66 out of the 70 LNG carrier orders placed worldwide.

South Korea imports 31 per cent of its total LNG supplies from QP.