Two South Korean shipbuilders have made fresh extensions on a series of 17 LNG carrier newbuilding berths being held for the much-delayed TotalEnergies-led Mozambique LNG project.
LNG newbuilding sources said that decisions on the vessels — nine of which are pencilled in at HD Hyundai Samho Heavy Industries and eight at Samsung Heavy Industries — were due to have been made by the end of January 2024.
But project shareholders now have until July before they need to make a call on them.
The delivery dates pencilled in on the ships are now said to stretch into 2028 and 2029. Four shipowners were assigned to the berths in 2020.
Japan’s Mitsui OSK Lines was lined up against five and K Line four of those at Hyundai Samho.
Fellow Japanese shipping giant NYK and Greece’s Maran Gas Maritime were listed with four berths each at SHI.
This is deemed to be the sixth extension on the 17 LNG berths.
Lead shareholder TotalEnergies has been wrestling with how to proceed with its long-planned 12.9 million tonnes per annum first phase of the Mozambique LNG project due to security issues in the region.
The company and its partners took a final investment decision on the project in 2019 but declared force majeure on it two years later as attacks in the region intensified.
Announcing its fourth-quarter results, the French energy major appeared to offer hope that it may be planning to move ahead with the project this year.
Earlier this month, TotalEnergies chief executive Patrick Pouyanne said the company was preparing to lift the force majeure and was close to a new arrangement with contractors on Mozambique LNG.
But this month has seen fresh attacks by Islamist insurgent groups in the Cabo Delgado region in northern Mozambique where the project would be located.
Shipping players have also highlighted that any move forward on the LNG newbuildings is likely to involve price renegotiations and a design update. As such, TotalEnergies may also consider re-tendering for the ships, one has said.
Pricing at the time the newbuilding berths were originally set was around $180m per vessel, compared to current prices reaching upwards of $260m, depending on specifications. The LNG carriers’ designs also pre-date some of the new environmental rulings and technology upgrades that have since been brought in, those who have experience with the project said, which would likely shorten the ships’ trading lifespan if they were not updated.
The fresh extension on the Mozambique newbuilding berths is significant in that it potentially frees up space in 2027 for other LNG business.
TradeWinds understands that several big names are chasing slots, but they are presently being presented or nudged into positions that offer vessel deliveries in 2028.
Those following the situation at South Korean yards said the key reason that shipbuilders have been able to offer the numerous extensions is the size of orders, the key client but also because they have been, and will continue to be, occupied by QatarEnergy’s LNG newbuilding project for over 100 ships.
