Capacity at the five Asian shipyards which have orders for LNG carriers is full until 2014, meaning there will continue to be a shortage of vessels to meet the rising global demand for gas.
The assessment of the LNG market came from Awilco LNG which was just listed on the Oslo Stock Exchange on Tuesday, driven by these market fundamentals.
“The LNG market is currently characterised by a strong growth in demand and a shortage of available vessels, conditions that the company considers highly favourable,” Awilco said in its 120-page listing prospectus.
The document highlights the company’s conviction that the five yards which have newbuilding orders – Samsung Heavy Industries, Daewoo Shipbuilding and Marine Engineering, Hudong-Zhonghua, Hyundai Heavy Industries and STX O&S– are unable to take any more LNG carrier orders until 2014.
Other smaller yards will be unable to step in to construct new vessels because LNG carriers are complicated to build and involve hefty liabilities for shipyards with limited experience in the sector.
“Hence correcting the shortfall in tonnage before 2014-2015 seems difficult,” said Awilco.