Hanwha Ocean's "2 Trillion" Order Jackpot... Surpassing Last Year's Orders in Just 6 Months

Construction Contracts for a Total of 8 LNG Carriers and VLCCs

Hanwha Ocean has hit a 'jackpot' with orders worth 2.1577 trillion won, surpassing last year's total order amount in just the first half of this year.

On the 1st, Hanwha Ocean announced that it signed construction contracts for a total of 8 vessels with two shipping companies in the Middle East, including 4 liquefied natural gas (LNG) carriers and 4 very large crude carriers (VLCCs). The total order amount reaches 2.1577 trillion won.

A liquefied natural gas (LNG) carrier built by Hanwha Ocean. [Photo by Hanwha Ocean]

With this contract, Hanwha Ocean has secured orders worth a total of 5.33 billion dollars so far this year, including 16 LNG carriers, 7 VLCCs, 2 ammonia fuel cell-powered ammonia carriers (VLACs), 1 very large gas carrier (VLGC), and 1 offshore facility. This surpasses last year's total order amount of 3.52 billion dollars in just six months.

Hanwha Ocean recorded an operating profit of 52.9 billion won in the first quarter, turning profitable due to increased sales of high value-added vessel types such as LNG carriers. During the earnings conference call held in April, Hanwha Ocean stated, "This year, the proportion of total sales from merchant ships will remain above 80% with the construction of more than 20 LNG carriers and large container ships," and added, "In the mid to long term, LNG carrier newbuilding demand will remain robust due to environmental regulations, increased U.S. LNG exports, and replacement demand for aging steam turbine LNG carriers."

This year, Hanwha Ocean's management performance is expected to fully reflect the construction results of LNG carriers ordered at high prices. Hanwha Ocean plans to build 22 LNG carriers this year and 24 LNG carriers next year, the highest number since its establishment.

The revival of the VLCC market is also expected to be a positive factor for Hanwha Ocean. Globally, 3 VLCCs were ordered in 2022, 18 last year, and as of the end of May this year, 37 have been ordered. Hanwha Ocean has built the largest number of VLCCs in operation worldwide, with 185 out of 919 vessels.

A Hanwha Ocean official said, "As the VLCC market gradually recovers, Hanwha Ocean, which has competitiveness and construction achievements in this field, is expected to benefit."