Photo: Image courtesy of DSME

DSME scores Novatek LNG order

South Korea’s Daewoo Shipbuilding & Marine Engineering has won an order to build liquefied natural gas barges for Russian LNG producer Novatek.

Under the deal, Daweoo will build two 360,000-cbm LNG barges for about 901.3 billion won ($748.2 million) with an option for two additional units.

The floating LNG storage and transshipment units will serve Novatek’s planned projects in Murmansk and Kamchatka that the Russian company will develop with Japan’s Mitsui O.S.K. Lines.

The floating units will transship Yamal and Arctic 2 cargoes from ice-breaking LNG carriers to conventional ships.

These transshipment hubs will significantly reduce transportation costs and shipping time of Arctic LNG cargoes going to Europe and Asia.

The Korean shipbuilder said in a statement on Monday that it expects to deliver the two LNG barges by the end of 2022.

Daewoo said that this deal will help the yard in the wake of the Covid-19 coronavirus pandemic which disturbed markets and caused delays for several large-scale projects.

Korean shipbuilders saw a significant decline in their order books this year due to owners holding back on orders as global energy demand nosedived and oil prices hit record lows.

Daewoo bagged $1.33 billion worth of deals this year including these two barges and a floating storage and regasification unit.

The biggest news this year was a huge order by Qatar Petroleum as the LNG giant has booked slots to secure more than 100 vessels worth about $19.2 billion at the Korean three biggest yards including DSME.

This is the largest shipbuilding deal in the history of the LNG industry whereas QP secured about 60 per cent of the global LNG shipbuilding capacity through 2027.

Breakdown of this order by shipbuilder is yet to be seen as QP did not reveal this info in its announcement.