Two shipping giants are teaming up to order five LNG carrier newbuildings out of the nine vessels required by Chinese energy major Sinopec. Another Chinese company is in the frame for the other four ships.
Several shipbuilding sources said Japan’s Mitsui OSK Lines and China’s Cosco Shipping LNG Investment, known as CSLNG, will order three LNG carriers at Dalian Shipbuilding Industry Co (DSIC). The planned deal will include an option for two additional vessels, the sources said.
Shipping sources added that the MOL and CSLNG project is still under discussion.
“But they should be able to close the deal,” he said.
A shipyard executive at DSIC said he has not heard of the newbuilding project by MOL and CSLNG. MOL has been contacted for comment on the order talk, and CSLNG and Sinopec could not be immediately reached for comment.
News of Sinopec seeking to charter LNG carriers was first reported in TradeWinds in June. The Chinese energy company wants to charter nine large LNG carriers for trading from 2026 onwards. The rates and length of the charter contracts have yet to emerge.
Shipbuilding sources said that if MOL and China Cosco Shipping-controlled CSLNG are to firm up the contract at DSIC, the deal would be the second Chinese LNG chartering project that the partners have engaged in so far this year.
In January, the duo ordered six 174,000-cbm LNG carriers at Hudong-Zhonghua Shipbuilding (Group) to be delivered between 2024 and 2026. The sextet was ordered on the back of long-term charter deals with China National Offshore Oil Corp (CNOOC).
The Hudong-Zhonghua LNG carriers, which will be fitted with the French GTT’s new cargo containment system named NO96 Super+, were reported to cost around $197m each.
Brokers believe MOL and CSLNG will be paying around $230m each to DSIC for the 175,000-cbm LNG carrier newbuildings, as that is the price that Chinese shipyards have been quoting. The vessels will be built with GTT’s Mark III Flex membrane containment systems.
TradeWinds reported in April that CSLNG was poised to order six LNG carriers at Hudong-Zhonghua for charter to Sinopec, but that deal did not materialise.
Meanwhile, market sources said Shandong Shipping is the unnamed owner that inked a preliminary deal for two 175,000-cbm LNG carriers at Jiangnan Shipyard. The contract was disclosed on Tuesday by China State Shipbuilding Corp (CSSC), the government-owned shipbuilding group that controls the yard.
CSSC said Jiangnan is scheduled to deliver LNG carriers by the end of 2027.
A newcomer to the LNG segment, Shandong is believed to hold an option for two additional vessels at the shipyard. A company official contacted by TradeWinds claimed to not be aware of the order talks.
Shandong is the third-largest state-owned shipping company in China. Clarksons’ Shipping Intelligence Network shows the outfit with around 70 vessels that include bulk carriers, MR tankers, LPG carriers and very large ethane carriers.
Sinopec needs the nine ships to transport the LNG it signed up for last year as part of a rush by Chinese buyers to secure long-term supply contracts.
The Chinese petrochemical giant signed a deal with US producer Venture Global LNG to buy four million tonnes per annum over 20 years.
Sources said 2.8m tonnes of this has been secured on a free-on-board basis, which will require eight to 10 LNG carriers to ship.
