South Korean ship service provider HD Hyundai Marine Solution Co. said it has won an order for renovating liquefied natural gas (LNG) carriers from global energy giant Chevron, according to Yonhap News.
The deal calls for installing environmentally friendly re-liquefaction systems on the two LNG vessels operated by Chevron, HD Hyundai Marine Solution said in a statement.
The contract also includes the application of an air lubrication system that reduces frictional resistance and a four-stage compressor that improves the efficiency of the fuel supply, thus increasing the ship’s energy efficiency and reducing carbon emissions.
The financial terms of the deal were not disclosed.
LNG is usually stored and transported in insulated tanks loaded on vessels as a cryogenic liquid, but a small amount of warming occurs, causing the LNG cargo to evaporate as it reaches its boiling point, a phenomenon called boil-off.
The boil-off gas (BOG) is spent as fuel, emitted into the atmosphere or otherwise forced to be burnt to keep cargo tank pressure steady, resulting in greenhouse gas emissions.
HD Hyundai Marine Solution said its re-liquefaction system provides a solution to liquefy the BOG and return it back to the cargo tanks, helping reduce LNG cargo loss and carbon dioxide emissions.
So far, HD Hyundai Marine Solution, a unit of the shipbuilding, oil refining and machinery conglomerate HD Hyundai, has clinched US$100 million worth of orders for the re-liquefaction of eight LNG carriers.
In June last year, the company bagged a $50 million order for the re-liquefaction of LNG carriers from a Norwegian shipper, the first such contract ever clinched by a South Korean company.
The global market for the re-liquefaction of LNG carriers has emerged as “a blue ocean” as some 100 LNG carriers without re-liquefaction systems currently operate across the world, market watchers said.
At present, the world market for LNG carrier re-liquefaction is estimated at approximately $700 million. Therefore, the installation of re-liquefaction units is attracting attention in the environmentally friendly ship conversion market.