China Merchants Energy Shipping (CMES) on 21 September announced that its subsidiary China LNG Shipping (CLNG) has teamed up with Greek-based Dynagas and compatriot Sinotrans Shipping to build five Arctic LNG carriers for the Yamal LNG project.
Dynagas, CLNG, and Sinotrans Shipping have a shared capital of USD296.5 million to build the LNG carriers, which are estimated to cost USD1.59 billion in total.
CLNG’s share of the capital funding is USD75.6 million, with USD37.8 million coming from CMES.
The daily freight rates of LNG carriers can reach as high as USD200,000 per day, and at least several hundred thousand US dollars in bad market situations, said Shanghai Shipping Exchange analyst Han Jun, adding that unlike bulk and container shipping, LNG and LPG projects need large amounts of investment.
CLNG, established in March 2004 as a joint venture between COSCO and CMES, was initially aimed to serve China’s first LNG import project in Guangdong.
Its revenue and profit as of 31 December 2014 are USD151 million and USD51 million, respectively.