QatarEnergy chooses Nakilat to own and operate up to 25 newbuild LNG carriers

Business & Finance

February 12, 2024, by Ajsa Habibic

As part of the second phase of its massive LNG fleet expansion project, QatarEnergy has selected Qatar Gas Transport Company (Nakilat) to own and operate up to 25 conventional-size LNG carriers pursuant to time charter parties (TCP) to be entered into by affiliates of the two companies.

Illustration only; Archive. Courtesy of QatarEnergy

QatarEnergy announced its decision on February 10 stating that this constitutes the first award in the second batch of long-term TCPs under the LNG fleet expansion project.

The 25 vessels, each with a capacity of 174,000 cubic meters, will be owned 100% by Nakilat and chartered out to affiliates of QatarEnergy. The LNG carriers are scheduled for construction at South Korean shipyards.

To remind, Qatar Energy kicked off the second phase of its fleet expansion program with a $3.9 billion order for 17 LNG carrier newbuilds placed at HD Hyundai Heavy Industries (HHI) in September 2023.

At the beginning of 2024, broker reports indicated that the company sealed a contract with Chinese shipbuilder CSSC Hudong Zhonghua shipbuilding for the construction of eight Q-Max ultra-large LNG carriers. The vessels will have a 271,000 cubic meter carrying capacity, making them the world’s largest.

Qatari heavyweight is also believed to be behind the latest massive order for 15 LNG carriers at Samsung Heavy Industries (SHI).

Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs, the President and CEO of QatarEnergy, said: “We are extremely pleased to announce this partnership with Nakilat, which reflects our confidence in Qatar’s flagship LNG shipping and maritime company. We are equally proud to see this LNG transportation champion compete as part of a global tender and be able to win on a purely competitive basis. This is a testament to Nakilat’s world-class capabilities as well as to the significant contributions of listed companies to the national economy.

“QatarEnergy is moving firmly in building its future LNG fleet, expected to be in excess of one hundred vessels. We look forward to announcing the names of additional successful bidders in the near future.”

In 2022, QatarEnergy signed a series of TCPs for the long-term charter and operation of 60 LNG ships, concluding the first phase of its fleet expansion program, which aims to support and meet future requirements of QatarEnergy’s North Field East (NFE) and North Field South (NFS) expansion projects.

This will also support the shipping requirements of QatarEnergy Trading to serve its global LNG portfolio, including volumes to be produced from the Golden Pass LNG export project. In addition, part of the program is intended to cater to the replacement requirements of the existing Qatar LNG fleet.