Newbuilding orders for LNG carrier and offshore facilities like drilling rigs are expected to flow steadily unless Eurozone crisis gets worse further, an industry analyst says.
Oh Sung-gwon, an analyst at Seoul-based Kyobo Securities says, "South Korean shipbuilders' stocks are under-valued currently, and if the Eurozone problem does not deteriorate further, commercial ship newbuilding market would be able to find rock-bottom going forward."
WTI Crude Oil price is expected to stabilize at around $100/bbl in a long-term basis, and global oil majors are to ramp up deep-water resources development from this year.
Deep-water energy development Capital Expenditure is forecast to reach $33.3bn this year, jumping 42% year-on-year and it would grow 23.3% annually on average until 2015, when it would hit $62.3bn, Mr Oh predicts.
Accordingly, deep-sea drillships and semi-submersible rigs are expected to be newly ordered in great numbers, surpassing 30 newbuilding orders in the sector in 2012.
Also, "Demand for LNG carriers is to grow steadily as China and India require more of the eco-friendly energy source and North American countries increase shale gas exports," he said.