Analysis of the market condition of LNG carriers

By Sun Minke & Cao Jiangxin & Gao Fei

Analysis of the market condition of LNG carriers

By Sun Minke & Cao Jiangxin & Gao Fei

In order to ensure the diversification of energy supply and improve the energy consumption structure, some major energy consuming countries pay more and more attention to the introduction of LNG. China, Japan, South Korea, the United States and Europe are building large number of LNG receiving stations. The international oil giants have also shifted their new prof i t growth point to the LNG business, and LNG will become another hot energy commodity after oil for global competition.

According to statistics, up to now, the number of global LNG carriers in total is 465, including 23 floating storage regasification units (FRSU) and 29 LNG carriers of 40,000 m3and below, amounting to a total of about 46.46 million tons. At present, the number of LNG carriers on hand-held order is 140, totaling 14.6 million GT, and accounting for 32% of the total transport capacity of the current LNG fleet (GT). Judging from the current condition of hand-held orders, those for super LNG carriers of 170,000m3accounted for a large part (about 105 ships), so large LNG carrier is the future development trend. These orders will be delivered successively in the next 2～3 years, even taking dismantling into account, the global LNG fleet in 2019 will be more than 600 ships, with the number and transport capacity of the fleet increasing 35% as compared with the current status. In the long run, withthe global environmental protection legislation becoming stricter, there will be still room for the development of LNG transport fl eet.

Currently, China's LNG fl eet size and transport capacity is limited, LNG import mostly relies on LNG fl eet of the international shipowners. Along with the steady growth of LNG import volume in China, there is still a big room for growth in the size and capacity of LNG transport fl eet. It is expected that by 2019, China's LNG fl eet will reach nearly 30 ships, the size and transport capacity of China's LNG fl eet will gradually expand.

At present, there are 29 small-size LNG carriers operating in the world, accounting for less than 1% of the total transport capacity of the global LNG transport ship, ship owners mostly come from Norway, Japan, France, Northern Ireland and Malaysia.

In the world, the number and capacity of medium and small LNG carriers are relatively smaller, and the international demand for LNG transport capacity is mainly focused on large LNG carriers due to their lower cost and higher transport eff i ciency. However, compared with the overseas demand market, China's second and third leg transshipment market is currently using LNG vehicles with no water transport market. In addition, compared with Japan and Northern Europe with active small LNG carriers, China has a vast territory, a longer coastline, and a denser river network. And more importantly, China's population and manufacturing scale is larger than Japan and Northern Europe, all of which determine that the potential for the development of China’s domestic trade market for LNG transportation is huge in the future.