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Satyendra Pathak
Doha
Qatar Gas Transport Company (Nakilat) will significantly benefit from Qatar’s LNG expansion programme announced recently by Qatar Petroleum, QNB Financial Services has said in a company report.
Qatar Petroleum recently announced that it has entered into three agreements with South Korean shipbuilders to reserve ship construction capacity as part of its programme to potentially build more than 100 LNG ships worth in excess of QR70 billion.
Under these agreements, the report said, the ‘Big 3’ Korean shipyards owned by Daewoo, Hyundai and Samsung will reserve a major portion of their LNG ship construction capacity for Qatar Petroleum through 2027.
These agreements follow on the heel of another major agreement announced in April, in which QP signed a similar deal potentially worth in excess of QR11 billion to reserve LNG shipbuilding capacity with the state-owned shipbuilding company in China.
“These deals with South Korean and Chinese shipbuilders mean that Qatar Petroleum has now secured roughly 60 percent of the global LNG shipbuilding capacity through 2027. This will constitute the largest LNG shipbuilding programme in history, potentially reaching more than 100 vessels worth in excess of QR70 billion,” the report said.
“Qatar Petroleum plans to use these vessels to primarily cater to Qatar’s expansion of its LNG capacity from 77 million tonnes per annum (MTPA) currently to 126 MTPA by 2027 along with other growth opportunities in the US and to replace existing ships as required,” QNBFS said in the report.
With 70 LNG vessels including 29 wholly-owned ships currently, the report said, Nakilat forms a vital link in Qatar’s LNG value chain.
“We remain bullish on Nakilat and consider it as the best avenue for equity investors to participate in the long-term growth expected in Qatar’s LNG sector,” it said.
While the ongoing downturn has influenced the global LNG shipping market, the report said, Nakilat’s business should remain relatively unaffected given the long-term nature of its charters.
“Going forward, in terms of catalysts, we continue to believe the expansion of Qatar’s LNG output from 77 MTPA to 126 MTPA is a significant driver,” it said.
“Currently our model does not assume any fleet expansion and we will incorporate such expansion once more details are revealed. We foresee significant upward revision to our estimates and price target once we factor in this expansion. For now, we maintain our accumulate rating and price target of QR2.60 per share,” it said.
Doha
Qatar Gas Transport Company (Nakilat) will significantly benefit from Qatar’s LNG expansion programme announced recently by Qatar Petroleum, QNB Financial Services has said in a company report.
Qatar Petroleum recently announced that it has entered into three agreements with South Korean shipbuilders to reserve ship construction capacity as part of its programme to potentially build more than 100 LNG ships worth in excess of QR70 billion.
Under these agreements, the report said, the ‘Big 3’ Korean shipyards owned by Daewoo, Hyundai and Samsung will reserve a major portion of their LNG ship construction capacity for Qatar Petroleum through 2027.
These agreements follow on the heel of another major agreement announced in April, in which QP signed a similar deal potentially worth in excess of QR11 billion to reserve LNG shipbuilding capacity with the state-owned shipbuilding company in China.
“These deals with South Korean and Chinese shipbuilders mean that Qatar Petroleum has now secured roughly 60 percent of the global LNG shipbuilding capacity through 2027. This will constitute the largest LNG shipbuilding programme in history, potentially reaching more than 100 vessels worth in excess of QR70 billion,” the report said.
“Qatar Petroleum plans to use these vessels to primarily cater to Qatar’s expansion of its LNG capacity from 77 million tonnes per annum (MTPA) currently to 126 MTPA by 2027 along with other growth opportunities in the US and to replace existing ships as required,” QNBFS said in the report.
With 70 LNG vessels including 29 wholly-owned ships currently, the report said, Nakilat forms a vital link in Qatar’s LNG value chain.
“We remain bullish on Nakilat and consider it as the best avenue for equity investors to participate in the long-term growth expected in Qatar’s LNG sector,” it said.
While the ongoing downturn has influenced the global LNG shipping market, the report said, Nakilat’s business should remain relatively unaffected given the long-term nature of its charters.
“Going forward, in terms of catalysts, we continue to believe the expansion of Qatar’s LNG output from 77 MTPA to 126 MTPA is a significant driver,” it said.
“Currently our model does not assume any fleet expansion and we will incorporate such expansion once more details are revealed. We foresee significant upward revision to our estimates and price target once we factor in this expansion. For now, we maintain our accumulate rating and price target of QR2.60 per share,” it said.
