Oliver Telling, Shotaro Tani, and Chan Ho-him of the Financial Times report that growing demand is forcing shipowners to turn to China to fill orders for LNG tankers despite its limited experience building the complex containers. They write:
Global shipowners are racing to tighten scrutiny of Chinese shipyards as soaring demand for liquefied natural gas carriers forces them to turn to inexperienced manufacturers in the world’s second-largest economy. Shipping groups around the world are looking to tighten the reins on the shipyards to ensure they meet global standards for the construction of LNG vessels.
Shipping groups around the world are looking to tighten the reins on the shipyards to ensure they meet global standards for the construction of LNG vessels. […]
Their increasing role in LNG carrier production mirrors China’s earlier takeover of other shipbuilding sectors, as its state-backed shipyards drew orders by undercutting rivals in South Korea and Japan on price. The average cost of building an LNG carrier in China is about $247mn, compared with $265mn in South Korea, according to Drewry. […]
Vanessa Tattersall, a partner at law firm HFW, said that although China was now delivering satisfactory LNG ships, similar situations had previously led to conflicts between shipbuilders and their customers.
“It will be interesting to see how many disputes we start seeing,” Tattersall said. “That’s my concern: are [Chinese shipyards] going to be able to cope with the amount of orders? Can they get these [LNG ships] out on time? Is any timing pressure that they’re undergoing to have an impact on quality?”
Also read: U.S. vs. China: China Has Over Two Hundred Times the Ship Building Compacity
