Middle Eastern shipowner Adnoc Logistics & Services (Adnoc L&S) has turned to Jiangnan Shipyard for its long-planned order for up to four LNG carriers — giving the Chinese shipbuilder its first big break in the sector.
Adnoc L&S — the shipping arm of energy firm Abu Dhabi National Oil Co (Adnoc) — is understood to have contracted two membrane-type 175,000-cbm LNG carriers at Jiangnan for delivery dates in 2025.
The company has also secured optional slots for two further ships.
Those following the business said the vessels are priced at about $200m each.
If this price is confirmed, it would be at a significant discount to current levels for LNG carrier newbuildings at South Korean yards, where prices are running at close to $220m per vessel.
The LNG carrier export orders are Jiangnan’s first.
In December, the shipbuilder and domestic competitor Dalian Shipbuilding Industry Co (DSIC) joined the small band of international shipbuilders capable of constructing large LNG carriers.
The state-owned China State Shipbuilding Corp (CSSC) yards have each inked letters of intent for one firm 175,000-cbm LNG ship with an option for an additional vessel with domestic owners.
Jiangnan signed up with CSSC Leasing for its LNG carrier newbuilding, while DSIC booked an LNG berth for China Merchants Energy Shipping.
Adnoc L&S launched its search for LNG carrier tonnage in the first quarter of 2021, emerging in the market for five newbuildings to replace its ageing fleet of eight Moss-type, steam turbine vessels that lift the emirate’s exports.
Vessel capacity (cbm) built
Al Khaznah 137,540 1994
Shahamah 135,469 1994
Ghasha 137,514 1995
Ish 137,540 1995
Mubaraz 137,000 1996
Mraweh 137,000 1996
Al Hamra 137,000 1997
Umm Al Ashtan 137,000 1997
Five shipyards were approached, and the Abu Dhabi-based owner countered their initial offers with a price of $180m per ship, against expectations of securing vessels at about $185m each.
The company was originally seeking delivery dates in the fourth quarter of 2024 and first three months of 2025, and had expectations of completing the orders by May 2021.
But in mid-2021, the company opted to put the business on ice as newbuilding prices firmed to more than $200m on the back of a huge hike in steel prices.
In addition, berth slots for 2024 and 2025 were disappearing in the face of a deluge of container ship orders and Qatar’s huge LNG slot reservation deal for vessels.
South Korea's big three shipyards are said to be virtually sold out on LNG berths for 2025 with big names such as Petronas being forced to split large orders across several yards to secure the early berths they are seeking.
But both shipowners and yards are reluctant to book up slots as far ahead as 2026 due to uncertainties over materials pricing and commodity demand requirements.
