Samsung Heavy wins $4bn worth of orders.
SOUTH Korean shipbuilder Samsung Heavy Industries has confirmed a package of orders that analysts said could total more than $4.7bn, including a deal from Shell to build a floating liquefied natural gas production vessel.
SHI said the value of the Shell contract would be decided by April 1, but analysts said the deal was worth $4bn.
The shipbuilder added that it had received orders totalling $740m for nine tankers from four European companies and an offshore facility from a customer from southeast Asia.
Confirmation of the shipbuilding order for the floating LNG vessel came eight months after Samsung Heavy and consortium partner Technip signed an agreement with Shell Gas & Power Developments for the front end engineering and design of the vessel.
The pact was inked as part of a wider master agreement signed last July between the three, covering the design, construction and installation of multiple floating LNG facilities over a period of up to 15 years.
Construction of the ship will start in 2012 with delivery scheduled for 2016.
SHI said the vessel could be up to 468m long, 74m wide and up to 100m high. The ship would be able to store 450,000 tonnes of LNG and produce around 3.5m tonnes of LNG a year. It is likely to be deployed to Shell"s Prelude and Concerto gas fields off Western Australia on delivery.
The shipbuilder said up to nine similar vessels could be built under the 15-year life of the master agreement with Shell. Estimates of the price of each vessel vary between $4bn-$5bn.
Commenting when the initial agreement with Samsung Heavy and Technip was signed, Shell said the floating LNG production vessel had ?the potential to place gas liquefaction facilities directly over offshore gas fields?. This would preclude ?the need for long distance pipelines and extensive onshore infrastructure?.
Shell added that after completing each front-end engineering and design phase, it would ?examine key aspects of each potential floating LNG project in its portfolio before considering a final investment decision?.
Speaking at the contract signing, SHI chief executive JW Kim said: ?Based on Samsung"s outstanding experience in LNG carriers and offshore projects, we are striving to expand our business to this new floating LNG market. This large scale floating LNG project awarded by Shell is an important milestone for us to launch into this new blue ocean.?