Gaslog has returned to its favourite South Korean shipbuilder Samsung Heavy Industries to order two more LNG carrier newbuildings.
The two 174,000-cbm ships have been placed after US LNG exporter Cheniere exercised its option for two new charter party agreements each for a firm period of seven years.
The options were attached to a contract agreed between GasLog and Cheniere for two 174,000-cbm vessels that was announced in August 2018.
GasLog chief executive Paul Wogan has been outspoken on the jump in LNG newbuilding orders placed, amid concerns it will create an overcapacity problem from 2021.
Despite the contract cover, the point was not lost on analysts following the latest announcement.
"While we believe the contract should generate solid returns and improve cash flow visibility, we are increasingly concerned that the torrid pace of new LNG vessel ordering is likely to lead to a challenging multi-year downturn in rates as a result of oversupply," said Ben Nolan of Stifel.
On Christmas Eve, Samsung disclosed that it had clinched a deal worth KRW 426bn ($378 m) to build two LNG carriers, but did not disclose the identity of the buyer.
The newbuilding contract calls for Samsung to deliver the vessels by August 2021, the company said in a regulatory filing.
Samsung has won six LNG carrier orders in December, according to Arctic Securities analysts Jo Ringheim and Lars Bastian.
The duo say the order takes the total number of vessels ordered for the sector this year to about 60 vessels.
With the latest order, Samsung has secured deals valued at a combined $6.1bn so far this year to build 48 ships, including 17 LNG carriers.
The shipbuilder aims to secure $8.2 billion worth of orders for the year.
GasLog now has nine newbuildings on order and 26 ships on the water.
