French membrane-type cargo containment system designer GTT is sitting on a record orderbook but is confident that the market is signalling strong future demand for LNG carriers.
Speaking in a results briefing, GTT chairman and chief executive Philippe Berterottiere said the long-term contracting of LNG volumes remains “dynamic”, which demonstrates that the LNG market is “profoundly sound”.
He said portfolio players and traders are investing heavily in long-term volumes that they will sell on, which is a sign of confidence in demand for LNG.
Berterottiere flagged up that 40 million tonnes of new liquefaction has been sanctioned so far this year with more expected to be sanctioned soon.
He also highlighted that 228 steam turbine ships remain in the LNG carrier fleet, which will be constrained in their trading under new emissions regulations and will fuel LNG carrier demand in the near term.
GTT notched up 42 orders for LNG carriers and one for a floating LNG (FLNG) production unit in the first six months of 2023.
Revenue from newbuildings during the period rose over 25% from €130.7m ($144.2m) to €163.5m.
Chief financial officer Virgine Aubagnac said by mid-year the company is sitting on an all-time high orderbook of 302 units worth nearly €1.8bn.
On 30 June 2023, this totalled 302 units, comprising 287 LNG carriers, two ethane vessels, one floating storage and regasification unit, one FLNG unit and 11 onshore storage tanks. In addition, there were 69 LNG-fuelled vessels.
She said this offers GTT — which receives the bulk of payment for its work on vessel deliveries — financial visibility out to 2027 and beyond. Running through each of the coming years she detailed that in 2025 the orderbook would contribute €600m on the scheduled delivery of 87 units showing the increase in yard capacity.
GTT’s net income for the first six months of 2023 jumped nearly 32% to €84m from €63.7m in the comparable January to June period last year.
First-half revenues climbed over 23% from €144.2m to €177.8m in the same six months of 2022.
Touching on its LNG bunker tank designs, Berterottiere said GTT sees LNG as a fuel as the “only available solution to reduce emissions”.
He said after strong orders for the company’s LNG bunker tank designs in the previous two years, up to now had been “a little bit disappointing”.
Berterottiere said some shipowners have opted for methanol as a marine fuel as they are betting on using bio-methanol. But he questioned how there can be sufficient quantities of this to supply the ships that have been ordered.
He said fossil methanol is generating more CO2 than LNG and marine diesel oil, whereas bio-LNG already exists and is being supplied today.
Berterottiere said some shipowners are now changing their minds and switching to LNG. He flagged up an order GTT received in July from China’s Yangzijiang Shipbuilding to design the bunker tanks for 10 LNG dual-fuelled ultra-large container ships. TradeWinds has reported that these vessels were contracted by French liner giant CMA CGM.
GTT is forecasting full-year revenues for 2023 of between €385m and €430m.
