There are 19 LNG ships this year! Samsung Heavy Industries has achieved more than half of its annual order target

Samsung Heavy Industries announced on July 1st that it has signed construction contracts for four LNG ships with shipowners in the Middle East and will deliver them to the shipowners gradually before August 2028. This is also the first batch of orders that Samsung Heavy Industries has taken on in nearly four months since early March.

Although Samsung Heavy Industries did not disclose the shipowner information, it is reported that this order comes from ADNOC Logistics&Services (ADNOC L&S), a subsidiary of Abu Dhabi National Oil Company (ADNOC). On the same day, ADNOC L&S announced that it had signed 4+1 contracts for the construction of 174000 square meter LNG ships with Samsung Heavy Industries and Han Hua Ocean (formerly Daewoo Shipbuilding), with a total value of $2.5 billion (approximately RMB 18.178 billion).

Including this contract, Samsung Heavy Industry has undertaken a total of 22 new ship orders worth 4.9 billion US dollars (approximately 35.61 billion RMB) this year, achieving 51% of the annual target of 9.7 billion US dollars, including 19 LNG ships, 2 ultra large liquid ammonia transport ships (VLACs), and 1 shuttle oil ship. As of now, Samsung Heavy Industry's handheld orders have reached $33.7 billion (approximately RMB 244.93 billion).

Since the beginning of this year, Samsung Heavy Industries has only undertaken 4 new ship orders, including 2 VLAC orders from shipowners in Oceania in January, with a total contract amount of KRW 315 billion (approximately USD 235 million); In February, we undertook an order for 15 174000 cubic meter LNG ships from Middle Eastern shipowners, with a total contract amount of 45716 trillion Korean won (approximately 3.435 billion US dollars); In March, we undertook an order for one shuttle oil tanker from a shipowner in Oceania, with a contract amount of KRW 19.8 billion (approximately USD 149 million).

In February of this year, Samsung Heavy Industries announced its target amount for accepting orders for this year, with a planned annual order amount of $9.7 billion for shipbuilding and marine engineering, an increase of 16.9% from last year's actual order amount of $8.3 billion and 2.1% from the confirmed order amount of $9.5 billion at the beginning of last year. It has become the only South Korean shipping company among the three major shipping companies to increase its order target for this year.

Samsung Heavy Industries stated that it is expected that the market demand for LNG ships and FLNG will continue to remain at a high level in 2024. With the expansion of demand for LPG and liquid ammonia, orders for gas transport ships will continue to grow. At the same time, there is also strong demand for the replacement of container ships and oil tankers using environmentally friendly ship technology. Based on market forecasts for the aforementioned ship types, Samsung Heavy Industry will continue to adopt a selective order taking strategy focused on improving profitability.

An official from Samsung Heavy Industry stated, "The increase in the number of ship constructions undertaken during the period of price recovery has contributed to the improvement of the company's performance. The company will continue to selectively accept orders based on stable holding orders for more than 3 years, with a focus on profitability this year."

In recent years, Samsung Heavy Industries has focused on accepting orders for high value-added ship types represented by LNG ships. Since the beginning of this year, Samsung Heavy Industry has undertaken a total of 22 ship to sea equipment orders, including 19 LNG ships. As of now, Samsung Heavy Industries has placed orders for approximately 100 handheld LNG ships, accounting for approximately 65% of the total number of handheld merchant ship orders. In addition, over 20% of the container ship orders undertaken by the company are LNG powered ships.

According to industry insiders in South Korea, "Since the beginning of this year, Samsung Heavy Industries' competitors HD Korea Shipbuilding Marine and Hanhua Marine have been focusing on accepting orders for ultra VLAC and ammonia fuel powered ships, while Samsung Heavy Industries is committed to undertaking LNG transport ships and LNG powered ships. Starting from March this year, the company has officially launched LNG refueling business, which can minimize the construction costs of over 100 LNG related ships."

A person from Samsung Heavy Industry said, "In the second half of this year, it is expected that global shipowners will also order various types of ships such as LNG ships and marine equipment from the company. The company will take technological competitiveness as the guide and make every effort to achieve its annual order targets. The company will also continue to conduct selective orders based on profitability, with a solid foundation of handheld orders."