DSME cancels second LNG carrier order linked to Russia’s Sovcomflot

South Korean shipbuilding giant Daewoo Shipbuilding and Marine Engineering said it has terminated an order for another LNG carrier after a European shipowner missed the payment deadline.

This follows a cancellation for one out of three LNG carriers in May tied to an order by Russia’s Sovcomflot.

DSME said in a stock exchange filling this order is related to a contract it had won in October 2020.

The contract worth about 1.1 trillion won ($872 million) included three LNG carriers with the unidentified European owner.

Under the deal, the shipbuilder had planned to deliver all of the three vessels by July 2023.

Following the cancelation of contracts for two vessels, DSME said the order for one LNG carrier remains in place. The single vessel contract now has a price tag of about 337.9 billion won.

Back in October 2020, DSME secured orders for six LNG carriers worth about 2.2 trillion won.

Novatek’s Arctic LNG 2 project entered into long-term charter agreements for these Arc7 ice-class LNG tankers with Sovcomflot but also Japan’s MOL.

Brokers and shipbuilding sources said that the termination of the first contract in May was related to one of the three Sovcomflot vessels as the Russian firm had been hit by sanctions.

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