One-third of LNG newbuildings on order are unchartered, or their owners have yet to declare them fixed for business, in a market in which demand and trade forecasts have been lowered by coronavirus.
A study of the orderbook by TradeWinds — alongside information provided by brokers and owners — shows that of the 132 large, pure LNG carriers and floating storage and regasification units on order, 45 (34%) appear to have no firm charters.
Of 26 shipowners known to be behind contracted vessels, at least seven have four or more LNG carrier newbuildings that are open for business.
John Angelicoussis-controlled Maran Gas Maritime would seem to have the most exposure, with an apparent 10 unfixed newbuildings on order for delivery dates ranging from this year through to mid-2022.
However, in reality it is sitting on six uncommitted ships. Four of the 10 vessels listed to Maran’s account are held in a joint venture with Qatar’s Nakilat, under the name Global Shipping Co. Nakilat holds a 60% stake in the new company and has responsibility for fixing the newbuildings.
The first of two DSME-built, 174,000-cbm M-type, electronically controlled gas-injection ships, is shown named as Global Energy. It is due to deliver this month with the Global Star scheduled for later this year. A pair of X-DF vessels will follow in 2021.
John Fredriksen’s Flex LNG is sitting on six unchartered LNG newbuildings, with just one of its seven on-order ships fixed on a five-year contract. Four of the unfixed vessels — two at DSME and two at Hyundai Heavy Industries — are due for delivery this year.
Flex LNG has spoken about delaying delivery dates “if the markets were not conducive”, but has stressed that the DSME duo will emerge during the traditionally stronger winter trading season.
Established owner
Greek shipowner Minerva Marine has five LNG carriers on order at two yards but has yet to announce charter plans for them.
A quartet of shipowners appears to have at least four open LNG carrier newbuildings each: BW LNG, Capital Gas, Celsius Shipping and Sinokor Merchant Marine.
BW is an established owner in the sector and brokers expect it to have an eye on business for these ships.
New LNG entrant Capital Gas originally contracted seven newbuildings but has fixed three of these to energy major customers.
LNG is a new play for tanker owner Celsius Shipping. The first of its vessels at Samsung Heavy Industries is due for handover in the fourth quarter of this year.
Mystery surrounds Sinokor’s four newbuildings at SHI. No confirmation has been given on the order, although hull numbers exist on the ships. This is the South Korean owner’s second move on LNG newbuildings after two ships contracted in 2014 were flipped into VLCCs.
In China, Dynagas also appears to have a pair of apparently uncommitted FSRUs — its first move into the floating regas sector.
The rest of the unfixed newbuildings are made up of single ships or pairs from owners such as MOL, NYK, Nisshin Shipping, JP Morgan’s interests, Tsakos Energy Navigation (TEN) and China’s CSSC.
Aside from TEN and Nisshin’s ships, it is less clear whether these vessels are actually open or reserved for off-market business.
Of more than 30 large LNG carriers scheduled for delivery this year, Maran Gas, Flex LNG and Celsius stand out as the three companies with uncommitted tonnage.
Consultants and market analysts forecast that the cargo cancellations that are already happening will probably continue into the third quarter. They warn that this will probably affect LNG shipping, particularly as charterers release more sublet vessels back on to the market.
In the longer term, however, they are more positive, expecting global gas demand to grow on the back of decarbonisation moves.
