World's LNG carriers idling because of project delays in Qatar

The world's biggest liquefied natural gas tankers are idling because delays at projects in Qatar, including that of ExxonMobil, have pushed down freight rates. South Korean shipyards led by Samsung Heavy Industries have delivered to Qatar two Q-Max and 13 Q-Flex ships, which carry as much as 80 % more fuel than a typical vessel, Russell Barling, a spokesman for Lloyd's Register, which certifies ships, said.
Qatar, the world's largest LNG producer, ordered 45 of the tankers to transport cargoes from the world's biggest LNG production lines, which have been delayed on equipment and labour shortages. Few terminals are able to accommodate the larger vessels, and project delays mean they have no regular cargoes to carry.

ExxonMobil has taken delivery of two new Q-Max LNG ships, Mozah and the Umm Slal, energy consultant PanEurasian Enterprises said. Charter rates for ships transporting spot shipments have almost halved to about $ 42,000 a day as the global recession cuts demand for spot cargoes inAsia, said Navin Thakur, an LNG shipping analyst at Drewry Maritime Services.
Qatar is using the large LNG carriers for spot supplies. Qatar and Exxon may find it profitable to store the gas at current $ 9 per mm Btu prices and sell it forward in the UK at 2009/10 December future of about $ 10.50, the report said.

"Given the present cost of money, it's not a boon, but it would mitigate the cost of having the ships sit idle," the Raleigh, North Carolina-based energy consultant said in the note.
The Q-Max tankers may cost as much as $ 300 mm each and carry a unit to capture and liquefy gases that escape from the storage tanks during the journey. On older models, about 0.14 % of the LNG escapes every day in gaseous form because of vibrations.
"Since both ships are equipped with reliquefaction equipment, it might make sense to use them for floating storage," the note said.

The vessels carry more than 200,000 cm each, against 145,000 on standard tankers. They are as long as 345 m (1,132 ft), the length of about three football fields, or 20 % more than a typical carrier. Two production lines, known as Train 4 and 5 at QatarGas, will be ready by June to December 2009, QatarGas Operating Co chief executive officer Faisal al-Suwaidi said on October 29. The lines will each produce 7.8 mm tpy. The trains may start shipments in 2009.
The Q-Max ships are powered by twin propellers instead of the single propeller on existing models. At import and export facilities, the LNG vessels need a larger turning radius, longer berth and bigger storage and loading facilities, Rob Tustin, technical manager at Lloyd's Register Asia, said on November 26.