China inks deal to build 4 LNG ships

Business, Normal

The National- Monday, January 17, 2011

 EXXONMOBIL, operator of the PNG Liquefied Natural Gas (LNG) project, and Mitsui & Co Ltd have signed a contract with China State Shipbuilding Corp (CSSC) signed to build four LNG ships to ship China’s import of gas from Papua New Guinea and Australia.

The contract was signed last Saturday without revealing the contract value. It is said to be China’s first overseas order for such an advanced carrier to ship LNG out of Papua New Guineas and Australia.

The Texas-based company said in an email that was later reported in Bloomberg online news that Hudong-Zhonghua Shipbuilding (Group) Co, Ltd, a subsidiary of CSSC, will build the ships for Mitsui, a Japanese shipping giant. 

ExxonMobil said the ships are scheduled for delivery between 2015 and 2016. 

“ExxonMobil was quoted saying: “The fleet will be used for shipping China’s imports of liquefied natural gas from Australia and Papua New Guinea.”

In 2009, ExxonMobil contracted with China’s major oil and gas producer PetroChina and refiner Sinopec to transport exports about 425 tonnes of liquefied natural gas per year. 

A liquefied natural gas carrier is a tanker ship designed for transporting liquefied gas at a temperature of minus 163 degrees Celsius, and marks an important part in the LNG supply chain. 

Only a handful of nations, such as the US, Japan and the South Korea have the ability to build such ships. 

Hudong-Zhonghua is China’s only LNG ship builder. 

Its first ship was delivered in April 2008. It has completed five vessels, with one still under-construction. 

The company did not disclose the price of the vessels.