Qatar Petroleum Orders its First Chinese-Built LNG Carriers
Qatar's state oil and gas company has put in a four-vessel, $770 million order for a series of LNG carriers at China State Shipbuilding Company's Hudong-Zhonghua Shipbuilding, the pioneer of LNG carrier construction in China.
The four vessels are the first batch of orders in Qatar Petroleum’s massive LNG shipbuilding program, which will provide the transportation needed for its North Field expansion project and for existing vessel replacements. It is also the first LNG carrier order ever placed by Qatar Petroleum with a Chinese shipyard. The deal has been a long time coming: it is the first firm commitment for an order under a long-term slot reservation agreement that Qatar reached with Hudong in April 2020.
“We are proud to contribute to the success story of the LNG ship construction industry in China. We are also confident in Hudong’s capabilities to execute this order . . . to the highest safety and technical standards and to deliver top quality LNG carriers that will facilitate continued safe and reliable delivery of LNG to the world," said Qatari Minister of State for Energy Saad Sherida Al-Kaabi, who also serves as CEO and President of Qatar Petroleum. "I would like to take this opportunity to thank Hudong’s team for all the hard work to bring this order to fruition during these challenging times."
Hudong has a long history with LNG carrier construction in China. It built the first Chinese-made LNG carrier, the Dapeng Sun, in 2008. It also won a high-profile contract for the construction of five LNG-fueled Megamax boxships for CMA CGM, which were delivered in 2020-2021.
The Qatari order represents something of a coming of age for CSSC's LNG capabilities. This lucrative niche market has long been dominated by South Korea's Big Three; however, the main Korean yards are filling their orderbooks fast, and Qatar is attempting to assemble the largest new LNG-carrier fleet in industry history. CSSC offers an extra source of yard capacity for the world's biggest LNG exporter.
Qatar has a significant need for new vessels. Global LNG demand is soaring, and QP is expanding to supply the booming market. Four new liquefaction trains at its North Field project will boost output from 77 million tons per annum to 126 million tons per annum. An additional two trains are said to be in the planning stages.
Like most of the CSSC yards with the capacity for complex shipbuilding, Hudong also has a military role. It has built 900 warships and auxiliaries for the PLA Navy over the years, and it considers itself the "cradle of Chinese frigates and landing ships."