A joint venture between Russian shipowner Sovcomflot (SCF Group) and energy company Novatek is due to sign newbuilding contracts for 10 ice-breaking LNG carriers before the end of next month with domestic yard Zvezda Shipbuilding Complex.
Sources said Smart LNG has the finance in place for the Arc7 newbuildings with Russia’s VEB.RF, with contracts slated to be inked by the end of next month.
But questions remain as to whether all the parties concerned will be ready to cement the deal to meet this timetable.
Key to this is Zvezda’s ability to complete its under-construction new dry dock, in which the LNG carriers will be completed.
Steel-cutting
Zvezda is working with Samsung Heavy Industries on the construction of the vessels. Steel cutting on the first of the ships is expected to take place in South Korea.
The 10 vessels will be in addition to the five already inked with Russia’s newest shipbuilder.
Sovcomflot signed up to the first flagship LNG newbuilding for Arctic LNG 2.
Smart LNG followed with the remaining four. Sergey Frank, the chairman of the board of directors at Sovcomflot, is believed to be taking a key role in Smart LNG.
At the close of last week, Smart LNG, which was set up in September to own and operate the LNG carriers for Arctic projects, said it had signed financing and time-charter agreements for these four ships with VEB.RF.
If confirmed, the latest order, alongside the earlier five-vessel contract, will deliver 15 Arc7 ships for the Novatek-led, 19.8-million-tonnes-per-annum Arctic LNG 2 project, which is due to start up in 2023.
Hull construction
SHI is expected to build the hull blocks for the latest order of vessels, with assembly and completion of the newbuildings to take place in Russia.
Smart LNG said it had drawn on the design of the world’s first 15 Arc7 ships for Novatek’s Yamal LNG project for Arctic LNG 2 project vessels.
Russia is looking to build a further 10 LNG newbuildings for its Arctic shipping projects and is in discussions with foreign shipyards about berth availability.
