Photo: Illustration/VLCC; Image by DSME

DSME inks LoI for 10 LNG-powered VLCCs

South Korean shipbuilder Daewoo Shipbuilding & Marine Engineering (DSME) has signed a Letter of Intent (LoI) to build 10 LNG-powered very large crude carriers (VLCCs) for an undisclosed European client, Business Korea reported citing the shipyard.

If the contract for the ten 300,000-ton dual fuel VLCCs moves forward, its value could hit KRW 1.1 trillion ($1 billion), with each tanker estimated to be worth around $100 million.

Based on the report, DSME expects to finalize the deal in the first quarter of 2021.

It has been a rather busy period for South Korean shipbuilding majors having reported a flurry of orders over the past month, helping end the year on a more positive note.

Last week, DSME reported it had won a $260 million order for three VLCCs from Abu Dhabi National Oil Company (ADNOC). The contract includes options for three additional ships.

DSME said that the ships are intended to run on low sulphur fuel, instead of being fitted with a scrubber, to meet the IMO 2020 Sulphur Cap, or feature a duel-fuel engine enabling the ship to run on LNG as its potential future fuel.

The vessels are scheduled for delivery in the first quarter of 2023.

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In the middle of November, the shipbuilder revealed a contract for the construction of six containerships for an undisclosed European shipowner.

Clarksons Platou Shipbroking said in its weekly bulletin that UK-based Zodiac Maritime was behind the order, adding that the ships will have 15,000 TEU capacity each.

The contract is worth $652 million (KRW 722.6 billion), the shipbuilder disclosed in a regulatory filing.

The containerships are scheduled for delivery in the first half of 2023.