Samsung Heavy, 3 Trillion Won Contracts in a Week... Additional Order of 4 LNG Carriers

Annual Orders of $11.2 Billion... Exceeding Target by 23%

[Asia Economy Reporter Hwang Yoon-joo] Samsung Heavy Industries is leveraging its liquefied natural gas (LNG) technology competitiveness to launch a high-value-added eco-friendly ship order rally in the second half of the year. It recorded orders worth 3 trillion won within a week.

Samsung Heavy Industries announced on the 25th that it received an order for four LNG carriers from a Bermuda-based shipping company, totaling 971.3 billion won. The price per LNG carrier is 242.8 billion won (206 million dollars), marking the highest level since 2015.

Following the order of seven shuttle tankers worth 2 trillion won on the 18th, Samsung Heavy Industries succeeded in additional orders on the same day, achieving 3 trillion won in orders within just one week. As a result, Samsung Heavy Industries' cumulative shipbuilding orders this year reached 11.2 billion dollars, a level comparable to the shipbuilding super cycle in 2007.

In particular, orders for eco-friendly ships capable of complying with the International Maritime Organization (IMO) regulations on sulfur oxide and carbon dioxide emissions account for 68% of the total order amount, totaling 7.6 billion dollars, rapidly increasing the order backlog focused on high-value-added ships in the second half of the year.

A Samsung Heavy Industries official stated, "Shipping companies' movements to comply with IMO 2023 regulations are accelerating, and demand for eco-friendly ships is expected to increase further," adding, "The expansion of orders is expected to continue a virtuous cycle leading to ship price increases."

Meanwhile, the IMO has set a goal to reduce the carbon intensity of shipping by 40% by 2030 compared to 2008 levels and by 70% by 2050 to cut greenhouse gas emissions. Accordingly, all existing ships must meet the Energy Efficiency Existing Ship Index (EEXI), calculated based on ship specifications, and the Carbon Intensity Indicator (CII), calculated annually based on operational performance, must also be reduced every year. The shipbuilding industry expects these measures to promote demand for retrofitting or building new eco-friendly ships.