QP signs QR70 bn shipbuilding agreements with Korean firms
The largest LNG shipbuilding agreements in history will help Qatar Petroleum secure more than 100 ships
QATAR Petroleum (QP) on Monday entered into three agreements to reserve LNG ship construction capacity in South Korea to secure more than 100 ships costing more than QR70 billion.
The three agreements — largest LNG shipbuilding agreements in history — reserve LNG ship construction capacity in South Korea to be utilised for QP’s future LNG carrier fleet requirements, including those for the ongoing expansion projects in the North Field and in the US.
Under the agreements, the ‘Big 3’ Korean shipyards — Daewoo Shipbuilding & Marine Engineering (DSME), Hyundai Heavy Industries (HHI) and Samsung Heavy Industries (SHI) — will reserve a major portion of their LNG ship construction capacity for Qatar Petroleum through the year 2027.
The agreements were signed by Minister of State for Energy Affairs, the President and CEO of Qatar Petroleum HE Saad Sherida
Al Kaabi, in a virtual signing ceremony attended by Minister of Trade, Industry & Energy of South Korea Sung Yun-mo.
From the Korean side, the agreement with DSME was signed by President and CEO of DSME Sung Geun Lee, with HHI was signed by the President and Board member of HHI Sam H. Ka, and the agreement with SHI was signed by President and CEO of SHI Joon Ou Nam.
“The signing of the agreements with the three esteemed Korean companies reflects our commitment to the North Field expansion projects, even during these extraordinary times. As I have previously stated, we are moving full steam ahead with the North Field expansion projects to raise Qatar’s LNG production capacity from 77 million today to 126 million tonnes per annum by 2027 to ensure the reliable supply of additional clean energy to the world at a time when investments to meet these requirements are most needed. These agreements will ensure our ability to meet our future LNG fleet requirements to support our expanding LNG production capacity and long-term fleet replacement requirements.”
The minister added that, “With the conclusion of these milestones agreements, we have everything in place to commence the largest LNG shipbuilding programme in history. We have secured approximately 60 percent of the global LNG shipbuilding capacity through 2027 to cater for our LNG carrier fleet requirements in the next 7-8 years, which could reach 100 plus new vessels with a programme value in excess of QR70 billion.”
Kaabi highlighted Korea’s position as a key and strategic energy partner with Qatar, and thanked the Minister Sung Yun-mo and the Korean companies for their role in supporting the strong Qatar-Korean business relations.
Kaabi said, “The new LNG vessels will be equipped with the latest generation slow speed dual fuel engines, utilising LNG as a fuel. This will ensure the most efficient performance and compliance with the latest global emission and environmental regulations. We will continue working on reducing emissions from our fleet to protect the environment in line with the Qatar National Vision 2030.”
“I would like to take this opportunity to thank the DSME, HHI and SHI teams for all the hard work to bring these agreements to fruition during these challenging times. I would also like to express my great appreciation to Your Excellency Sung, for your leadership and great support to this effort in line with our mutual desire to build upon the already excellent relations between Korea and Qatar, especially during the unusual circumstances the world is currently facing. I am also very grateful to Sheikh Khalid bin Khalifa Al Thani, CEO of Qatargas, and to the Qatar Petroleum and Qatargas teams, whose dedicated efforts were instrumental in realising this agreement,” Kaabi said.
S Korean minister Sung Yun-mo said, “Despite the recent difficulties facing the international community, today’s signing was made possible by the long-standing mutual trust between Korea and Qatar as well as the outstanding risk management capability of Minister Kaabi.”
He also expressed his commitment to enhance economic cooperation with Qatar.
He said, “I will not spare any effort to further strengthen our bilateral cooperation in energy and shipbuilding, as well as diversify our cooperation across various fields, including ICT, healthcare, plant construction and more.”
Also speaking at the virtual signing ceremony, President and CEO of Daewoo Shipbuilding & Marine Engineering said, “I would like to express our sincere appreciation to Qatar Petroleum for choosing DSME as a partner for this historic Mega LNG project in Qatar. I have no doubt that Qatar will reinforce its position as the world’s leading LNG exporter through this great project. As the world’s first-class shipbuilding and maritime specialists, DSME is delighted to contribute to this project with our cutting-edge LNG technologies together with our eco-friendly and smart ship expertise. In the same manner as a decade ago for the previous Qatar project, we will soon invite you to witness our production in person at our advanced Okpo shipyard.”
For his part, President and Board member of Hyundai Heavy Industries said, “We are very proud and excited to work with Qatar Petroleum for this unprecedented, and the world’s largest, LNG project. It is our firm belief that this project will enhance Qatar’s global reputation as the world’s premier LNG supplier and effectively contribute to the increasing global market demand for cleaner energy of the future. To this end, we will join forces with Qatar Petroleum and Qatargas with the highest standards of excellence for the successful construction and delivery of vessels that are more efficient and eco-friendly than ever.”
President and CEO of Samsung Heavy Industries Joon Ou Nam said, “I am grateful for the signing of this agreement between Qatar Petroleum and Samsung Heavy Industries. SHI promises to deliver the best quality LNG carriers with ontime delivery. Particularly, we will build the best LNG carriers for Qatar Petroleum in terms of efficiency, reliability and HSE through the technology and workmanship developed within our company. I hope that today’s event will provide momentum to further strengthen our cooperative economic relationship between Qatar and Korea.”