- South Korean shipbuilders benefit as Europe seeks alternatives to pipeline gas
- Russian gas pipelines are being replaced by the Middle East and South-East Asia
- Samsung heavy industry winning huge orders
- Build up for South Korea post the Ukrainian Invasion says, Nikkei Asia.
Substituting Russian Imports
As European countries reduce natural gas purchases from Russia, Samsung Heavy Industries said it has won orders for 14 liquefied natural gas carriers worth 3.9 trillion won ($3 billion) and is also looking for alternative sources of fuel amidst the Ukrainian invasion.
Orders received were for ships each with an enormous tank capacity. This is the largest number of orders from the South Korean shipbuilding industry at once. Samsung Heavy Industries has received orders for 24 LNG carriers this year alone, reaching a value of $6.3 billion and achieving 72% of the annual order target.
30% of Europe’s natural gas imports rely on Russia which is imported through gas pipelines, as an alternative to this, Europe is planning on increasing its import from the Middle East and South-East Asia.
High demand from South Korea
As a result, the world’s major maritime shipping lines are placing more orders for LNG vessels with them which is resulting in great benefits for South Korea’s major shipbuilders.
But Samsung Heavy is still struggling with the legacy of loss-making orders made during the shipbuilding recession. It is expected to take time before the current strong orders are reflected in the company’s earnings and lead to some recovery.
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Source: Nikkei Asia