Qatar Petroleum signs US$19 bil shipbuilding agreements with Korean companies

DUBAI: Qatar Petroleum (QP) said on Monday it has signed agreements with South Korea’s “Big 3” shipyards to secure more than 100 ships costing more than US$19.23 billion.

The agreements signed with Daewoo Shipbuilding & Marine Engineering, Hyundai Heavy Industries and Samsung Heavy Industries will occupy much of the three companies’ liquefied natural gas (LNG) ship construction capacity through 2027.

Under the deal, described by QP chief executive as the largest LNG shipbuilding programme in history, the three companies will reserve a major portion of their LNG ship construction capacity for Qatar Petroleum through the year 2027.

“We have secured approximately 60% of the global LNG shipbuilding capacity through 2027 to cater for our LNG carrier fleet requirements in the next 7-8 years, which could reach 100+ new vessels with a program value in excess of US$19.23 billion,” said Saad al-Kaabi, QP’s chief executive and Qatar’s energy minister.

QP, the state-run LNG producer in the world’s top supplier of the fuel, wants to lift output to around 126 million tonnes per annum (mtpa) by 2027 from today’s 77 mtpa.

Exploration work in the expanded North Field mega project showed confirmed gas reserves there exceed 1,760 trillion cubic feet, Kaabi said in November.

“We are moving full steam ahead with the North Field expansion projects,” he said in Monday’s statement.

“The agreements will ensure our ability to meet our future LNG fleet requirements to support our expanding LNG production capacity and long-term fleet replacement requirements.”

Though plans to start production from its new gas facilities were postponed to 2025, due to a delay in the bidding process and the impact of the coronavirus, Kaabi had told Reuters in April his company will not scale back a plan to build six new LNG production trains.

The three South Korean companies’ CEOs were cited in the QP release but did not issue statements of their own on the deals.