Korea Shipbuilding & Offshore Engineering Co. (KSOE) said Wednesday it has replaced existing contracts for three liquefied natural gas (LNG) carriers with new ones with a higher price tag amid supply chain disruptions.
KSOE, a subholding company of global shipping titan Hyundai Heavy Industries Holdings, said in a regulatory filing that it has inked a 314.1 billion-won ($240 million) contract with an Oceanian-registered shipper to build a LNG carrier, a replacement of the original 198.9 billion-won order won from a Liberian-registered shipping firm in January 2021.
The shipyard has also substituted a 420.7 billion-won order to build two LNG vessels for the Liberian shipper with a new 628.2 billion-won contract with the Oceanian shipping line.
"KSOE canceled the original contracts in line with an agreement with the Liberian shipper and signed new deals due to a disrupted supply of key parts," the shipyard said.
Hyundai Samho Heavy Industries Co., a KSOE affiliate, will build the LNG carriers and deliver them in August 2023 and in the same month in 2024, respectively.
KSOE did not disclose the nationality of the parties that had placed the original orders, but industry sources said they are probably a Russian company. Shipping lines are usually known to place orders on behalf of vessel owners.
KSOE has three shipbuilding affiliates -- Hyundai Heavy Industries Co., Hyundai Mipo Dockyard Co. and Hyundai Samho Heavy Industries.
Last Thursday, Daewoo Shipbuilding & Marine Engineering Co. also said it had canceled a contract to build one LNG carrier with a European shipper, which was part of a deal to construct three LNG ships.
The cancellation came as the ship's owner, presumed to be a Russian company, did not make the payment for the vessel within a predetermined date, the shipyard said.
Meanwhile, South Korean shipyards have enjoyed a jump in LNG orders in the first half as they are more competitive in building those ships than foreign rivals.
In the January-March period, South Korean shipbuilding companies clinched orders for 63 LNG vessels, or 5.44 million compensated gross tons (CGTs), taking up 71 percent of the global total at 7.68 million CGTs, according to global market researcher Clarkson Research Service. (Yonhap)