DSME gets $200 million LNG carrier contract

Daewoo Shipbuilding and Marine Engineering said yesterday it has secured a $200 million order to build a liquefied natural gas (LNG) carrier.

The company will build the 173,400-cubic-meter (226,798-cubic-yard) ship for a U.S. company at its Okpo Shipyard in Geoje, South Gyeongsang, for delivery by 2017.

The order follows a contract with the same American company in July in which DSME had an optional clause for an additional carrier. DMSE declined to identify the customer due to contract stipulations.

DSME said its LNG carrier is equipped with a fuel efficient ME-GI engine from MAN Diesel & Turbo, the world’s largest maker of ship engines, and its own high-pressure natural gas fuel injection system. The company said its LNG carrier will be 20 percent more fuel efficient than ships with dual-fuel diesel engines. In addition, the shipmaker said it produces 30 percent less emissions of sulphur oxides (SOx) and nitrogen oxide (NOx).

“DSME has patented core technology used by the world’s largest maker of ship engines,” the company said in a release. “Since our contract with the customer includes building three more LNG carriers, we expect to secure more orders.”

DSME secured orders last December and July to build LNG carriers that use natural gas as their main fuel. It has secured all the orders for LNG carriers in the world this year.

“Because the SOx regulation is going to be reinforced, the era of the LNG-fueled ship is going to come soon,” said Park Moo-hyun, an analyst at E-Trade Securities. “Shipbuilders like DSME and Hyundai Mipo Dockyard will likely benefit from this changing trend.”

Meanwhile, DSME has received $11.98 billion in orders this year for merchant vessels and other ships.

After the order was announced, DSME shares rose slightly to close at 37,100 won ($34) in the stock market.

BY JOO KYUNG-DON [kjoo@joongang.co.kr]