The need for China-made liquefied natural gas tankers will remain high and generate profound changes within the global market landscape, driven by burgeoning demand for LNG in many countries such as India, Japan, France and Brazil, market observers said.
 

Major domestic shipbuilders, including Jiangnan Shipyard and Dalian Shipbuilding Industry, which are subsidiaries of Shanghai-based China State Shipbuilding Corp Ltd, as well as Yangzijiang Shipbuilding Group and China Merchants Heavy Industry (Jiangsu), logged 55 LNG carrier orders in 2022, accounting for over 30 percent of the world's total, a record high for the country, according to Beijing-based China Association of the National Shipbuilding Industry.
 

These orders were placed by global clients, such as Nippon Yusen Kabushiki Kaisha, a Japanese marine transporter, QatarEnergy and ADNOC Logistics & Services, the shipping arm of the United Arab Emirates-based Abu Dhabi National Oil Co. The ships are needed to transport LNG to countries that have high demand for clean energy, including China, Japan, South Korea, India, the United Kingdom and Argentina, as well as many other G20 economies.
 

This is a significant breakthrough for domestic players. For them, this area is a must-have market, said Li Yanqing, CANSI's secretary-general.
 

Chinese shipyards have overtaken many of their global rivals in two high-tech sectors — offshore engineering products and mega container vessel shipbuilding. They are now relying on their accumulation of technology and the country's well-developed industrial chain to compete with their South Korean rivals in building LNG carriers, he said.
 

For instance, Hudong-Zhonghua Shipbuilding (Group) Co Ltd, another subsidiary of China State Shipbuilding Corp Ltd — the country's largest shipbuilding group by sales revenue — had nearly 50 orders for LNG carriers pending by the end of January, with production scheduled until 2028. The company plans to begin construction of nine LNG ships this year and deliver four.
 

Hudong-Zhonghua received 37 orders for building LNG tankers from both overseas and domestic shipowners in 2022. The second phase of the company's shipbuilding center in Changxing county, Zhejiang province, is under construction. The new facilities will be used for the construction of LNG carriers.
 

Its docks, workshops, supporting facilities and warehouses are scheduled to be completed and put into operation this year and next. The LNG carrier production capacity of the Shanghai-based shipyard, enabled by the new move, will be expanded from between five and six vessels in 2022 to between 10 and 12 on an annual basis after 2024.
 

Building LNG carriers requires more advanced technology than what is used to make conventional storage tanks. They need to store LNG at a temperature of — 162 C and are mostly powered by steam turbines, reflecting a vital part of the LNG supply chain. Only a handful of countries such as China, Japan, South Korea, the US and Germany, have the ability to build such vessels.
 

Spurred by soaring rates to transport LNG amid tight global energy supplies, Chinese shipbuilders and their competitors in South Korea — the world's largest manufacturer of LNG carriers with more than 65 percent of global market share — are expected to rapidly ramp up construction of new LNG carriers in the coming years, said Wu Zhixing, an analyst at the institute of international technology and economy of the Beijing-based Development Research Center of the State Council.
 

The LNG vessel market's rapid growth is happening as global demand for LNG soars sharply against the backdrop of the accelerating pace of carbon neutrality and turmoil in the global energy market, Wu said.
 

According to British shipbuilding and marine analysis agency Clarkson Research Services, LNG shipping volumes will grow by 65 percent between 2023 and 2032.China has opportunities to seize more market share in this area, as well as further upgrade its foreign trade structure, experts said.
 

In addition to building more LNG tankers, China has also made headway in producing other high-end ships and marine engineering equipment.
 

The country began construction of its second-largest cruise ship, and delivered the world's first 100,000-metric-ton intelligent aquaculture vessel, floating production storage and offloading ships as well as mega-container vessels with a capacity of 24,000 standard 20-foot equivalent container units in 2022.
 

In the meantime, China topped the global shipbuilding industry in three major indicators — contributing 47.3 percent of global output, receiving 55.2 percent of new orders and obtaining 49 percent of holding orders — the Ministry of Industry and Information Technology said.
 

China's shipbuilding industry is in a steady upward trend this year, entering a recovery cycle amidst the COVID-19 pandemic, given surging global shipping demand, especially for crude oil and natural gas, according to Dong Liwan, a professor of shipbuilding at Shanghai Maritime University.

Source: China Daily

Please Contact Us at：

media@xindemarine.com