Chinese shipyards aiming for $10bn LNG tanker orders by 2020

5 August 2014 (Last Updated August 5th, 2014 18:30)

Chinese shipyards are reportedly seeking to secure orders worth nearly $10bn for building new liquefied natural gas (LNG) tankers over the next five to six years.

Chinese shipyards are reportedly seeking to secure orders worth nearly $10bn for building new liquefied natural gas (LNG) tankers over the next five to six years.

The construction of natural gas tankers is expected to allow China to boost its shipbuilding sector and position itself to compete with major South Korean and Japanese players.

China State Shipbuilding subsidiary Marine Design and Research Institute of China principal naval architect Yang Baohe said: "In future, our output is going to outstrip that of Japan and Korea."

China’s plan to switch from coal to cleaner fuels comes as a result of increased regulatory pressure to reduce carbon emissions. The country plans to more than double its entire gas supply by 2020 and triple LNG imports to around 60 million tonnes.

"Regardless of the availability in the market for LNG carriers, China will ship the bulk of its cargoes through its own project dedicated vessels."

According to data from ship safety agency American Bureau of Shipping (ABS), China is scheduled to build up to 50 LNG vessels, more than 20% of the 225 LNG vessels that are expected to be built worldwide, by the end of this decade.

The new vessels are expected to help China deliver gas to its ports and thus increase its energy supply chain in future.

BMT Asia Pacific Singapore transport and energy consultant business development manager Andrew Bridson said: "Regardless of the availability in the market for LNG carriers, China will ship the bulk of its cargoes through its own project dedicated vessels."

The global demand seeks an investment of around $50bn to expand the fleet of LNG tankers to 394 vessels, according to ABS.