Shipyards in China are pushing to secure around USD 10 billion worth of new LNG orders until 2020, in an effort to revive the country’s faltering shipbuilding sector.
This latest incentive to form natural gas delivery vessel fleet of their own is aimed at bolstering China’s chances at challenging South Korean and Japanese shipyards that have cornered the large gas tanker building market in recent decades, as Reuters reports.
American Bureau of Shipping (ABS) estimates that up to 50 out of 225 liquefied natural gas (LNG) tankers expected to be built by 2020 are planned for construction in Chinese shipyards, and intended for supplying gas to Chinese ports.
The global shipping industry is reeling from a half a decade of downturn, the worst recorded in last 30 years. China as a leader in building of basic vessels now sees its chance to diversify, and test its mettle in the area of sophisticated shipbuilding.
“In future, our output is going to outstrip that of Japan and Korea,” said Yang Baohe, principal naval architect at the Marine Design & Research Institute of China, a subsidiary of China State Shipbuilding Corporation (CSSC).
Over 70 percent of approximately 125 LNG carriers and storage vessels being built currently have gone to South Korean shipyards, mostly Daewoo Shipbuilding and Marine Engineering and Samsung Heavy Industries.
On the other hand, these orders make up a little over half of the overall investment of close to USD 50bn necessary to boost the global LNG fleet to 394 vessels.
China is feeling the heat of the urgency to switch from coal to eco-friendlier fuels in an effort to cut carbon emissions, hence its plan to almost triple the total gas supply by the end of the decade.
This shift is seen as a chance for relatively inexperienced Chinese shipyards to enter the LNG market by building vessels for China’s growing needs.
World Maritime News Staff; August 5, 2014; Image: COSCO