Adnoc L&S awards $2.5bn shipbuilding contracts to South Korean shipyards
Adnoc Logistics and Services (Adnoc L&S), a unit of UAE energy company Adnoc, announced on July 1 that it had awarded South Korean shipyards Samsung Heavy Industries and Hanwha Ocean up to $2.5bn in shipbuilding contracts for the construction of new LNG carriers as part of its fleet expansion plans.
Each of Samsung Heavy Industries and Hanwha Ocean were awarded contracts for the construction of four vessels with an option for an additional one, for a total of ten vessels. The vessels are expected to be delivered beginning in 2028 and will be time chartered to Adnoc Group subsidiaries for a period of 20 years. The new vessels will increase the company’s fleet of LNG carriers from 14 to at least 22 vessels.
Abdulkareem Al Masabi, CEO of Adnoc L&S, said: “We have now committed to over 50% of our medium-term strategic investment target one year post our record-breaking IPO in 2023.”
At the time of its public listing last year, Adnoc L&S said it was targeting investments of $4-5bn over the medium term to capitalise on “high-probability, value-accretive business opportunities.” Following its Q1 financial performance and growth in activities across all business segments, the company revised its growth guidance upwards, now intending to invest in excess of $5bn in energy-related maritime logistics over the medium term to meet growing demand in and beyond the UAE. The realisation of value-accretive growth opportunities is incremental to the recently announced $1.4bn acquisition of Navig8, it said.
“These LNG carriers will employ cutting-edge technology to increase fuel efficiencies and reduce carbon intensity in line with the company’s sustainability goals,” said Al Masabi.
The LNG carriers will each have a capacity of 174,000 m³ and feature MEGA and XDF2.2 engines. They will include sustainability technologies such as a cargo conditioning system designed to reduce LNG cargo evaporation while in transit, systems to direct cargo boil-off gases to the engines to increase fuel efficiency and decrease fuel consumption, a real-time emissions monitoring system, and cargo containment systems to reduce methane emissions.