Article written by Mike Corkhill, BIMCO
In terms of new production capacity 2013 has been another nondescript year in the LNG sector. The volume of LNG traded globally during the current 12 months is expected to just about match the total achieved in 2012, itself a desultory year and one of only three in the past 30 in which LNG shipments actually slumped.
Yet in every other respect 2013 has been a glorious year for LNG. Natural gas, and LNG as a means of moving the product from a growing range of sellers to an even wider band of buyers, continues to hog the energy transport limelight. Developments in the oil and coal sectors appear tame by comparison to what has been happening in the world of LNG.
As of 1 October, a total of 44 LNG carriers had been ordered so far in 2013. The new contracts comprise 32 conventional size LNG carriers, eight coastal tankers, three floating storage and regasification units (FSRUs) and the world’s first dedicated LNG bunker vessel. The last of the FSRUs to be ordered, in recent weeks, is a vessel of 263,000 m3, or 50% higher in capacity than the next largest FSRU ever conceived.
In value terms the 2013 LNG orderbook represents approximately USD 8 billion worth of new contracts. Korean yards have secured 25 of the 44 newbuilding contracts, Chinese yards 14 and Japanese yards five.
Allowing for the 11 LNG carriers completed so far in 2013, the vessels ordered this year have boosted the number of LNG vessels on order to 119. This total is equal to about one-third the size of the current fleet in terms of vessel numbers. The size of the current LNG orderbook has only been eclipsed once before – midway through the previous decade.
Today’s list of LNG vessels on order is more diverse than that of 10 years ago. It includes three floating production (FLNG) units, 13 FSRUs and three 30,000 m3 ships with Type C tanks earmarked for Chinese coastal distribution duties. The FLNGs and the three Chinese coastal LNG carriers, like the LNG bunker tanker mentioned earlier, are the first vessels of their types.
The healthy LNG orderbook is configured to provide the tonnage that will be required to transport the new waves of LNG production due to come on stream in the years ahead. The immediate focus is the 65 million tonnes per annum (mta) of new liquefaction plant capacity currently under construction in seven separate projects in Australia.
The new Australian capacity represents approximately one-quarter of the global trade in LNG, which currently stands at the 236 mta mark. The first LNG from the new projects will begin to flow in 2015 and by 2017 Australia will have an LNG production capacity approaching 90 mta.
Qatar, currently the world’s leading LNG producer, has the capacity to liquefy 77 mta of LNG from 14 trains at Ras Laffan. Most of this capability is currently being utilised and the 76.4 million tonnes sold to the global marketplace in 2012 was more than three times the volume of its closest rival, Malaysia.
Above text is part of MikeCorkhill article, written for BIMCO. You may read full article by clicking here.
