LNG producer Qatar has been sorting through prospective new names of shipowners and managers that it has not previously worked with on LNG carrier tonnage as it pursues its large requirement for vessels.
Those following Qatar Petroleum’s business to access up to 151 LNG carriers said the liquefaction giant has been sorting through the details of about 20 companies.
They added that these are thought to be both shipowners — some of whom are relatively new to LNG — and shipmanagers.
Tender tactics
Their understanding is that Qatar Petroleum will whittle the candidates down to a small number.
The company will then issue a tender for the vessels to a group of owners and managers, comprising both new names and shipowners which Qatar has worked with previously on LNG carriers.
Established names include Japan’s big three owners — Mitsui OSK Lines, NYK Line and K Line — and two of the country’s traders — Iino Kaiun and Mitsui & Co.
Qatar also has existing ties on LNG shipping with John Angelicoussis’ Maran Gas Maritime — with whom Qatari LNG shipowner Nakilat has two joint ventures and Teekay LNG.
The Gulf state previously worked on LNG tonnage with Pronav Ship Management, which was bought by Germany’s Schulte Group in 2018. Four Q-Flex ships were also owned in partnership with OSG Shipholding Group but OSG, by then operating as International Seaways on these ships, was later bought out of these vessels by Nakilat.
Timing
Some sources said they do not expect the shipowner tender requesting offers on the newbuildings to emerge until December. But others suggested it could be sooner.
Qatar made its first call on shipowners for the vessels back in mid-2019, casting the net wide among the owning community and asking for initial offers on up to 60 LNG carriers.
At that time, Qatargas said it would marry up its shipyard positions with owners and sign newbuilding contracts and time-charter deals on the vessels together.
Since then and in parallel, shipbuilders have been working with Qatar Petroleum and its associates on the slew of 151 LNG newbuilding berth slots the company firmed up in April and May in what looks set to become the world’s largest newbuilding project.
Qatar Petroleum signed deeds of agreement (DOA) reserving slots for up to 16 berths with China’s Hudong-Zhonghua Shipbuilding (Group) and 45 slots at each of South Korea’s big three shipbuilders — Hyundai Heavy Industries, Daewoo Shipbuilding & Marine Engineering and Samsung Heavy Industries.
Pricing pressures
TradeWinds has been told that under the DOAs the newbuildings have been agreed but there is also a currency adjustment clause as the delivery dates are so far ahead.
Qatar Petroleum selected slots for vessels that can deliver from 2023 into 2026.
Based on the CNY 20bn ($2.85bn) quoted for the 16 Chinese ships, this would price the vessels at about $180m each.
But with newbuilding prices having come under fresh downward pressure since the DOAs were signed, some industry players suggested that Qatar might want to revisit its pricing with yards.
They also said that while Qatar is keen to capture LNG market share on its sales over competitors, such as expansionist-minded Russia and newcomer Mozambique, it may also be less urgent to move as the Covid-19 pandemic continues to create demand uncertainty for LNG and other commodities.
Qatar is seeking its super-large LNG carrier haul to provide tonnage for its North Field Expansion project — which would grow its domestic production from 77 million tonnes per annum to 126 mtpa.
The vessels would also serve the 16-mtpa Golden Pass LNG development in the US, in which parent company Qatar Petroleum is a shareholder.
In addition, the producer needs new vessels to replace older ships in its fleet as they come off hire.
