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Surge in LNG-fuelled newbuilding orders

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The latest figures from DNV’s Alternative Fuels Insight (AIF) platform show an increased take-up of LNG-fuelled newbuilding contracts over the first four months of this year, compared with the corresponding period of 2021.

Large ships to be powered by the fuel drove orders over the first four months to a total of 121, according to the AIF, with 51 new contracts placed in April alone

There are currently 775 LNG-fuelled ships either in service or on order and further 221 that are classed as LNG-ready

While car/passenger ferries form the largest part of the LNG-powered fleet today with 48 ships, containerships are set to be far the dominant vessel type in future with 155 on order adding to 34 currently on the water.

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However, the faster contracting pace seen in the first four months of 2022 is likely to slow down, as owners hesitate on placing new orders because of higher fuel and new ship prices.  

LNG bunkering vessels could also become a constraint, however. DNV’s principal consultant in the classification society’s Maritime Advisory business unit said that when gas prices return to a level “where LNG bunkering makes sense”, there will be insufficient LNG bunkering capacity to service all the ships.

“It’s easy to understand fuel suppliers’ hesitance to increase their bets and contract more tonnage in this challenging market,” he said.

However, on the general contracting picture, he commented: “Last month’s orders alone for LNG-fuelled ships added about half a million tonnes of LNG demand. Should this trend continue at the same pace, we could reach the 1000-vessel mark by the end of this year. However, although we expect growth to continue, it is likely to be more modest for the rest of the year.”

 

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