Samsung Heavy Industries has revealed it is being paid around $2.5bn for its work in building 15 specialised ice-breaking LNG carriers for the Russian Arctic.
The South Korean shipyard group said in a regulatory filing that it had won orders from European shipowners to supply blocks and equipment for the vessels without giving details of the work or parties involved.
The yard’s contract on this work runs until December 2025.
The order represents a sizeable part of SHI’s sales for the year and means it has met 45% of its order target for 2020.
Industry sources said the contracts relate to the 15 Arc7 LNG newbuildings ordered at Russia’s Zvezda Shipbuilding Complex to serve the Novatek-led Arctic LNG 2 project.
The first of these orders was placed by shipowner Sovcomflot (SCF Group), with the remaining 14 contracted by Smart LNG, a joint venture between Sovcomflot and Novatek.
TradeWinds first reported on SHI’s partnership with Zvezda on the Arc7 LNG newbuildings in June 2019.
Under the tie up, the first hull blocks will be built at SHI’s facilities in South Korea. But construction of the hull blocks is expected to be transitioned over to Russia as work on the later delivering vessels progresses.
The 300-metre-long ships will have a capacity of more than 172,000 cbm and be able to produce 45 MW of power from three unique azimuth propulsion units.
Late last week, Zvezda held a steel-cutting ceremony for a Sovcomflot vessel, which is the first of the 15 Arc7 newbuildings.
The ship is due for delivery in first quarter of 2023 and will be a test for Zvezda, which has not yet built LNG carriers.
At the event, Russian deputy prime minister Yury Borisov said the newbuildings will have increased speed and manoeuvrability when sailing in ice conditions, compared with icebreaking LNG carriers of the previous generation.
“This will, for the first time, allow year-round navigation in the eastern sector of the Russian Arctic, thereby expediting the implementation of national plans to boost cargo traffic along the Northern Sea Route,” Borisov said.
Sovcomflot president and chief executive Igor Tonkovidov said the LNG carriers will all be registered under the Russian flag and have Russian crews.
"The start of construction of the first in this new generation of LNG carriers by Zvezda is a significant milestone for the Russian shipbuilding industry, which has never before constructed vessels with this level of engineering complexity,” he said.
